The Junk bonds have it’s best behavior of all the century

There Junk bonds succeeded in the beginning of the 80′s in the market of the United States thanks to Michael Milken, who inspired a character in a film by Gordon Gekko, the mad in the film of Wall Street.

These Junk bonds are in his best rally since 1996, after having positive profitavilities during 14 consecutive months, due to the growing hunger from investors to the risk in the middle of an scenario of low interest rates. In the year, they won a 4.74% according the index Bank of America Merrill Lynch US High Yield Master II.

The Junk bonds had one of the bests behaviors in the industry. The category grew by an average of

47,29% I the lest 12 months, by 6,9% during the first quarter of 2010 and by 3,01% in March, according figures from Interactive Data.

Among the Junk bonds, we can highlight the products from Aberdeen, UBS Global Asset Management and BNP Paribas, with profits of 163%, 80,57% y 79,06% respectively. “A year ago,people thought that it was the end of the world. However the doubts on defaulting of many companies became brighter”. Explained Andrés Francoy, responsible of Fixed-income securities in the unity of big assets in Deutsche Bank.

Credit rating of the Junk bonds.

These assets are called junk bonds for his high level of risk and because they dispose of a very low credit rating, what points a high possibility that a company couldn’t be able of afford his financial compromises. For that reason, when a firm with a credit rating lower than BBB- , according Standard & Poor’s and Fitch or Baa3, according Moody’s, wants to issue debt, investors want astronomical profitavilities to purchase these titles.

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