In schweser its written that , “The price change of HY Bonds is driven more by spread change than the changes in Risk Free interest rates”
Then in CFAI as per example 1 of reading 25 (pg 241) its written that credit risk is usually the most important consideration for high yield portfolio managers because of the higher credit risk and credit loss rate in high yield portfolios compared with IG portfolios. For IG portfolio managers , interest rate, spread and credit migration risks are typically the most relevant considerations.
This is really confusing. Although I have seen some threads related to this question but could not find a proper answer anywhere. Can someone please explain?
