Junk bond funds seen at a crossroads.(Short Interests)

Investment News, August, 2006

Byline: David Hoffman Junk bond funds, which saw outflows in June, had inflows of $400 million last month, according to a report last week from Lipper Inc. of New York. "I was surprised to see even moderate flows in this economy,'' said Tom Roseen, a Denver-based senior research analyst with Lipper.

There is a lot of uncertainty over which way the economy will go, he said. If it heads south as some experts predict, investors in high-yield-bond funds will get hurt, Mr. Roseen added. But sometimes the lure of extra yield can be too strong to fight. Those investors who put money into junk bond funds probably did so because they were attracted to the high yields such investments typically pay out, said Charles Lieberman, strategist...

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