Risks grow as Asian high yield continues rally

Asset allocators face a tricky decision. Should they continue pumping funds into Asian high yield, where momentum remains strong but credit spreads are at historically tight levels and potentially at risk of a blow out? In 2016, high-yield bonds were one of the world’s best-performing asset classes, particularly US issues, which benefited from a weak base effect in 2015. The Bank of America Merrill Lynch US High Yield Index rose 17.5% over the course of the year after dropping 4.7…