Credit Spread Dispersion: A Tale of Two Markets

Research evidence excerpt

Credit Spread Dispersion: A Tale of Two Markets

Credit Strategy Research

18 June 2026 | 3:12PM EDT

GLOBAL CREDIT TRADER

n One relative value commonality across corporate credit markets—across USD Amanda Lynam, CPA

+1(212)934-1895 |

and EUR, and IG and HY—has been the historically tight range of spread amanda.lynam@gs.com

Goldman Sachs & Co. LLC

valuations at the index level. What is somewhat underappreciated, in our view,

Spencer Rogers, CFA

has been the divergence in dispersion trends under the surface. Using a range of +1(801)884-1104 |

spencer.rogers@gs.com

spread measures (bond, rating, sector), we find that IG dispersion remains Goldman Sachs & Co. LLC

unusually low, while HY dispersion is elevated. Sara Grut +44(20)7774-8622 | sara.grut@gs.com

Goldman Sachs International

n We see three key drivers. First, the yield-based demand technical has been more

Shamshad Ali

powerful in IG vs. HY, as measured by the share of all-in yields represented by +1(212)902-6712 |

shamshad.ali@gs.com

spreads. Second, HY firms are more sensitive to the current backdrop of Goldman Sachs & Co. LLC

below-trend growth and elevated inflation, given their thinner financial cushions.

Third, market structure developments have likely played some role in tightening

dispersion within IG, as improvements in liquidity have compressed the premium

embedded in spreads.

n In IG, we place greater emphasis on broader market risk exposures and duration

positioning, as we see less scope for bottom-up security selection to generate

consistent investment performance (relative to HY). That said, the ongoing wave

of AI-related financing in the corporate debt market is becoming a more

influential driver of performance for some sectors and issuers, and is already a

driver of dispersion at the ratings level.