Chapter 6 of The Intelligent Investor discusses: Junk bonds Foreign bonds New stock issues – IPOs Second grade bonds – Junk bonds
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This is not really a contemporary subject but one to keep in mind for when bond opportunities arise. Graham discusses how sometimes second grade bonds, or what we would now call high yield or junk bonds trade at extreme discounts to their maturity value due to changes in interest rates and due to the change in the perception of risk. The junk bond yield has significantly increased over the past few months but is still far from opportunity territory as it was the case in 2016, 2011 and especially 2009.
