Study Says Junk Bonds Not As Risky:...

Study Says Junk Bonds Not As Risky: High-yield junk bonds are not as risky as recent studies suggest and earned higher returns than high-grade corporate and government bonds between 1977 and 1988 after the effects of defaults, says a new study by two researchers at the University of Pennsylvania’s Wharton School of Business. The study, which claims to dispute a recent report by former researchers at Harvard’s Graduate School of Business Administration, says that junk bonds returned 8.5% annually over the decade, better than intermediate-term Treasury bonds at 7.6%.