Certified financial planner Jason Flurry, of Planmark Capital Management, says investors usually get back 75 cents to 80 cents on the dollar when there's a default.
"Floating-rate funds give investors better downside protection relative to high yield in the event of credit quality declining," says Flurry
."I like the fact that credit quality is improving.Moody's and Standard & Poor's
expect default rates to decline to about 2 percent by the end of the year." Flurry
says these investments should be thought of as short-term, high-yield bonds with terms -- often 30 days, 60 days or 90 days -- that are much shorter than typical high-yield bonds.
Loads and expenses reduce your return, but that doesn't always mean you should opt for the lowest cost fund, Flurry