Is The High-Yield Bond Market Partying Like It's 1999?

In a new report, UBS analyst Matthew Mish compares the current U.S. high-yield bond market cycle to the cycle that occurred in the late 1990s. According to Mish, comparisons to the 1990s support UBS’s idea that high-yield bonds will likely generate solid returns in a low-yielding environment in coming years.
 

Related Link: 5 Must-Have Apps For Market Technicians
 

“HY bond valuations have re-priced significantly and are no longer expensive; in fact, the higher quality segments of the market will probably generate at least low-to-mid single digit excess returns, respectable in a low yielding environment,” Mish concludes.
 

The SPDR Barclays Capital High Yield Bnd ETF JNK is down 5.8 percent so far in 2016.
 

Disclosure: the author holds no position in the stocks mentioned.