Goldman Prefers High-Yield Bonds as Way to Make Downside Bets
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Investors skeptical about the recent U.S. risk-asset rally should look to the high-yield corporate bond market to protect their portfolios, according to Goldman Sachs Group Inc.
The cost of bearish put options on the iShares iBoxx High Yield Corporate Bond exchange traded fund is historically cheap relative to those of the S&P 500 Index, strategists including Christian Mueller-Glissmann wrote in a note Friday. However, corporate credit losses have been similar to those on stocks in past risk-off periods, they said.