AI Bubble Watch BETA
No one knows when or if AI stocks, or the market itself, will head into correction territory. This dashboard tracks a few data points that may be early indicators of trouble.
The data below are strictly for educational purposes and are not investment advice.
(market-wide)
(riskiest junk)
(iShares high-yield ETF)
HYG is updated twice daily (noon & 5pm ET). CCC and HY spread are updated once at the end of the day. Last update: Jul 3, 6:10 PM ET.
Sources and methodology
Sources:
High-yield spread — Federal Reserve Bank of St. Louis, series BAMLH0A0HYM2 (ICE BofA US High Yield Option-Adjusted Spread)
CCC spread — Federal Reserve Bank of St. Louis, series BAMLH0A3HYC (ICE BofA US High Yield CCC & Lower Option-Adjusted Spread)
HYG ETF — Yahoo Finance
Green: within normal historical range.
Yellow: territory that has historically preceded credit stress.
Red: Levels associated with significant market disruption in past cycles (2018, 2020, 2022).
Color gradients are for illustrative purposes only and do not correspond to recognized industry standards.
About the dials
- High-yield spread
(market-wide) - The high-yield spread is the extra interest risky companies must pay to borrow, compared with the U.S. government. So 3% means that a company is paying 3% more than the U.S. government to borrow money in the bond market. When it climbs, it means lenders are getting nervous. This is a broad, early indicator of trouble in private sector lending to corporations.
- CCC spread
(riskiest junk) - The CCC spread measures the same thing as the high-yield spread above, but only for the riskiest borrowers — companies rated CCC or lower, which are the ones closest to defaulting. Because these borrowers are most vulnerable, their spread tends to blow out first when credit markets get nervous. Think of it as the canary in the coal mine: if this one spikes before the broader high-yield spread does, that's a signal that something is starting to crack.
- HYG
(iShares high-yield ETF) - HYG is an ETF that contains hundreds of high-yield (risky/junk) corporate bonds. The HYG ETF trades like a stock. The number in the dial represents the percent that the price of the ETF has dropped versus its 52-week high. If the 52-week high is $100 and the current price is $98, the dial says 2%. A lower price (and thus a higher percent in the dial) means investors think their bonds are riskier, and they have to sell them at a discount.
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