| any corporate bond with a low rating and a high yield, often involving high risk. |

| junk bond n. A corporate bond having a high yield and high risk. |
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Junk Bond
A bond rated BB or lower because of its high default risk. Also known as a high-yield bond, or speculative bond.
Investopedia Commentary
These are usually purchased for speculative purposes. Junk bonds typically offer interest rates three to four percentage points higher than safer government issues.
Related Links
Junk Bonds: Everything You Need to Know
Corporate Bonds: An Introduction To Credit Risk
Bond Basics Tutorial
See also: Bond, Bond Rating, Default Risk, Stub, Vulture Fund
junk bond