Carl Icahn Warns of Risk in Stocks and High Yield Bonds

By on June 25, 2015

Carl IcahnCarl Icahn, reknowned for his large net worth ($23.3 billion) and investor activism, was on CNBC this week cautioning the public of the dangers involved in investing in stocks and junk bonds at current valuations.

“Investors are walking into a trap again as they did in ’07,” Icahn warned. He considers it his duty to highlight the errors investors are making. Icahn indicated the high-yield bond market is particularly dangerous. He considers it ridiculous to chase yields of 5 1/4 percent, a two percentage point premium over investment grade corporate bonds when the ultimate downside could be 40%.

A year ago, Icahn expressed concern over Janet Yellen’s excessive money printing [link].

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