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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: zebra4o1 who wrote (21733)	11/13/2004 1:27:32 PM
From: mishedlo	Respond to of 110194

Hey, what happened in early 2004 to make these high yield funds tank? Was that the deflation scare? Concern over FNM, F, GM, airlines etc. Like everything else this year, the market eventually got over it. Fillmore is correct, if corporate bonds give up the ghost, the party is over. Unlike others here, I think that will produce a "flight to quality", quality being defined quite loosely, AKA Treasuries. Mish

To: zebra4o1 who wrote (21733)	11/13/2004 1:36:30 PM
From: Crimson Ghost	Read Replies (1) \| Respond to of 110194

You are correct that SPHIX is one of the more conservative high yield funds. It also is an open end fund -- so you cannot short it. But the more speculative closed end high yield funds may indeed be ripe for shorting. In addition to the very low quality of their holdings closed end funds -- unlike mutual funds --can sell significantly above net asset value. An ideal short might be one of the more risky closed end high yield funds selling above net asset value.