Europe is learning to love high-yield bonds

The European high-yield bond market is far smaller than its US counterpart. However, strong performance and a wider array of companies in which to invest means its popularity should continue to grow

The idea of including a European high-yield bond component within balanced portfolios is gradually gaining credibility among the pan-European consultant and pension fund community and may eventually filter down to discretionary and fund of fund investment managers. By recording gains of 30.1% in the JP Morgan European High Yield Bond Index, in sterling terms, during 2003 the asset class has certainly raised its profile among institutional investors. However, this newfound interest is not only due to the strong absolute performance recorded last year. After all, during the previous two year...