The high yield market consists of the debt of corporations that have relatively high levels of leverage. These debt securities are rated as ‘below investment grade,’ or “junk bonds,” i.e. BB rated or lower (using Standard and Poor’s rating definition). These issuers have been assigned lower ratings by credit rating agencies based on their greater risk of default and/or loss on default. Hence, higher yields are required to attract and compensate investors for taking on that default risk.