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While there are individual EU HY bonds yielding lower than Treasuries, that is not the market as a whole. To be generous, 30 year Treasuries are currently yiel
by whatok 9y ago
While there are individual EU HY bonds yielding lower than Treasuries, that is not the market as a whole. To be generous, 30 year Treasuries are currently yielding 2.84%. I'm looking at Bloomberg Barclays Pan-European High Yield index (ticker LP01TREU) and it currently has a YTW of 3.24% with an average life of 5.07. If you were to match that life to 5 year Treasuries, those are yielding 1.82% right now. That's not even touching on the currency and duration mismatches.
- ringaroundthetx 9y agoYes, and Pan-European means there are 30 countries which can be isolated for inefficiencies. Outside of the European Union with its one central bank distorting things very publicly, there is the Swiss National Bank distorting similarly and steeper with much less publicity, there is an even steeper negative yield in Sweden, Denmark and more. The "average" is a sideshow when there is so much opportunity if you know where to look.