Junk Bond (High-Yield Bond)
InvestingA bond rated below investment grade (BB+ or lower), offering higher yields to compensate for greater default risk.
Example
Example: Consider an investor building a $100,000 portfolio. Junk Bond (High-Yield Bond) — a bond rated below investment grade (bb+ or lower), offering higher yields to compensate — directly affects investment strategy and long-term returns. Getting this concept right can mean tens of thousands of dollars in difference over a 20-year period. Model your portfolio with our investment calculator.