(Bloomberg) -- Junk-debt returns will fall short of lofty expectations, but they’ll likely do better than stocks for the first time since the global financial crisis, according to high-yield guru Marty Fridson.

Speculative-grade US bonds are set for a total return of 5.18% over the next five years on an annualized basis. That falls short of the 1987-2024 mean of 8.48%, as well as the 6.80% median, Fridson, whose debt analysis has been studied by Wall Street for decades, wrote in a report Thursday.

US stocks typically do better than corporate bonds, which tend to be less volatile while also having fixed coupons and defined repayment dates. High valuations, concerns about the outlook for earnings and the economy, and unpredictable US policy-making are leading some to predict an equity downturn.

“It is worthy of consideration by asset allocators that high yield’s expected five-year annualized return is substantially higher than that of equities, a riskier asset class,” the chief executive officer of FridsonVision High Yield Strategy wrote.

However, he added that the present yield on speculative-grade bonds doesn’t point to a future return that is high by historical standards.

Fridson predicts 3% annualized returns over the next five years for the S&P 500 equity index, based on a similar correlation analysis as he uses for bonds. That would mark the first time since the period starting December 2008 that junk outperforms stocks over the following half-decade.

Since corporate bond spreads collapsed to historic tights last year, buyers have preferred to focus instead on all-in yields, which are high by historical standards because of elevated Treasury rates. But Fridson calls that “grasping at straws” and notes that the high-yield bond market “sports a risk premium grossly inadequate for its current risk.”

US junk spreads widened earlier this week to the highest since October, at 292 basis points, far from the 425 basis points level that Fridson deems fair value. Yields meanwhile held at about 7.2%, above the five-year average of 6.9%, making them look relatively attractive to bond investors.

“Beginning yield does have a bearing on future returns,” wrote Fridson. “It is worthy of consideration by asset allocators, however, that high yield’s expected five-year annualized return is substantially higher than that of equities.”