“The increase in distressed debt is being driven by low and falling commodity prices. Yields on many energy issues—which make up 14% of the high-yield market—have risen, pushing their prices lower and leading to a greater number of distressed bonds.  Distressed debt as a percentage of the high-yield corporate market has risen to its highest level since August 2012.  Investors lowering their credit quality in search of better returns haven’t been rewarded. The bonds that offered the highest yields at the end of last year have generated the lowest total return to date, and vice versa. Caa-rated bonds have suffered the largest price declines.”

http://www.schwab.com/public/schwab/nn/articles/How-Has-the-Rise-in-Distressed-Debt-Affected-the-High-Yield-Bond-Market

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