JNK has turned out to be my best investment this year, but I admit junk bonds didn't turn me on at first. I made my first buy in May at 32.95 and got a $.412 dividend for that month., a yield of 14,8%. I bought again in June at 35.37 and the dividend was $.400 Again in July at 35.83 and the dividend was .400 and finally in August at 35.75, dividend at .406. By then I had all that was prudent for my portfolio but the value kept increasing.. The monthly dividends have been going down and the yield for the December 29 dividend was about 11.1% If you want to look the individual bond holdings of the fund they are on the web site. You will see that maturities spread from fairly distant to near term and lower to higher yields. As the higher yields mature they have to be replaced with new paper with lower yields which I think is why the dividend creeps lower. But it's still a lot higher than most anything else around and I think the risk is a lot less than the name implies. The price is down about 1.40 over the last couple weeks, but you can watch it daily and it pays monthly and the market is active so getting out is not problem. I look at it as a good conservative part of my portfolio and a good income source.
You make some excellent points. Many people don't realize that junk bonds are actually safer than stocks. They always have been. ================================================== I have always believed that, and in thelast 30 years it has been proven true for me.