Bond: what do you mean by when you say bond outperformed index by so and so bps since this date?
Earlier today I was on bloomberg primer and reading about one company, there I read that the bond of that company has outperformed the Bloomberg Barclays high bond yield index by 2990 bps since 2016.I am having really difficult time understanding this. Can someone please explain me what does it actually mean. Does it mean that it YTM on bond is 2990 bps higher than index ? Or its spread is 2990 bps wider?
Total return. It sounds a bit strange though. 2990 bps is 29.9%. In order to get that return since 2016, it would have to have been trading in distress like around 80s. And recently traded up. It's most likely a basic materials or energy company. I don't think that the AGG is a good benchmark for that tbh. Outperform or underperform always relates to its returns.
Even I found it strange, 29.9% is just too much and thats why I got confused, anyways company is Titan International. SO this simply means that it has given 29.9% more return than index?
it's probably data mining. spreads blew out q1 2016 and then came down in a hurry throughout the rest of the year, so it's not outside the realm of possibility that a high coupon energy company got priced to default, didn't default, and since the high point in their yield (low point in price), they rose dramatically.
Ut voluptas ut dolore. Impedit aspernatur quia dolor debitis et ducimus delectus fugiat. Quidem beatae amet placeat repellat asperiores rerum. Numquam saepe totam optio quos.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...