High Yield: The Comeback Kid – Chart by Gershon Distenfeld, Alliance Bernstein
How swift will this recovery be? The US high-yield market has suffered nine peak-to-trough losses greater than 5% in the last 17 years. On average, investors recovered their losses in only four months—and sometimes as few as two. Following the longest and largest drawdown, which lasted 19 months and reached –35%, investors who stayed in the high-yield market earned back 55% in just eight months.