What the Spread Pays For
A company bond yields more than a Treasury because the company can default, its bonds are harder to sell, and in a crisis they fall when investors most need cash. The spread bundles all three.
Spreads come in two families. Investment-grade companies, rated BBB− or better, pay — over Treasuries today. High-yield companies, rated below that, pay —.
Spreads Over Treasuries
Option-adjusted spreads on the ICE BofA U.S. corporate indexes.
What Today’s Level Says
Over the long run, the high-yield spread has averaged about 5 percentage points. It reached about 20 points at the end of 2008 and about 11 in March 2020. At —, investors are asking for well below the average, which means they expect few defaults and are comfortable taking risk.
Tight spreads are a sign of confidence, but also of thin protection: when they are low, there is little cushion if the economy turns. Widening spreads have often been one of the earlier warnings of trouble, because bond investors focus on the downside.
How It Connects to Stocks
Spreads and stock prices tend to move as mirror images. When spreads widen, the cost of borrowing rises for the riskiest companies first, and their shares usually fall with it. Watching the high-yield spread is a quick way to check whether the bond market agrees with the stock market’s mood.
Takeaway. Low spreads mean investors are relaxed about credit. That helps companies borrow, but it leaves less margin of safety for lenders.
Figures in copper come straight from FRED and update every weekday; other figures are as of October 21, 2026. For education only, not investment advice.