Even though the US economy is on the road to recovery and the market expects the Federal Reserve to start its rate normalisation by the second half of next year, high-yield bond funds are expected to remain an attractive investment product as emerging markets continue to offer higher returns than developed countries, said Kittikun Tanaratpattanakit, a senior data analyst at Morningstar Thailand.
High-yield bond funds' net asset value increased from early this year, while net inflow to these funds doubled to
High-yield bond funds invest primarily in securities that are either not rated, or have been rated below investment grade by the major ratings agencies for higher yields.
Mr Kittikun said the funds, which normally have a maturity of 6-12 months, offer returns of around 3% per year, still higher than the local comparative deposit rate of 1-2%. The most active funds are managed by asset management firms under banks, which have a large investor base.
Kesara Manchusree, president of the Stock Exchange of
In the meantime, Smith Banomyong, president of
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