Things could get far worse before they get better for high-yield bond investors, said Collin Martin, fixed income director at the Schwab Center for Financial Research (SCHW - Get Report) .

"Yields do look more attractive now, but if you look at historical cycles, we saw spreads and yields in the late 1990's early 2000's move a little bit higher than where they are right now," said Martin. Even though the sector looks more attractive now, we think prices can drop a little bit further.

The SPDR Barclays High Yield Bond ETF (JNK - Get Report) is down more than 5% thus far in 2016, after dropping 12% last year.

Martin said a bottom in commodity prices, notably oil, would be a signal that it is time to step in and start buying high-yield debt. He said it is difficult to get too excited about junk bonds when many of the energy companies -- even those that survive the downturn -- will still be struggling to manage their debt loads.

"Ultimately, we are going to see default rates rise with oil prices remaining so low," said Martin.

As to whether the energy sector has contaminated the rest of the high-yield world, Martin said spreads on other sectors like telecom and health care have indeed risen, so energy issuers are not isolated. In fact, he said high-yield spreads ex-energy have doubled in the past two years. 

And Martin also does not entirely believe that high yield will be significantly helped if the Federal Reserve backs off its plan to aggressively raise rates in 2016.

"Our base case is that the Fed will raise rates once this year, maybe just once unfortunately," said Martin. "We will still see stock market volatility and that hurts the high-yield bond market. And with the high yields that these junk companies are paying, it makes it harder for them to come to market with new debt and refinance their bonds."

Martin said a much better fixed income asset class is municipal bonds, especially local general obligation bonds. 

"We think their fundamentals continue to improve and their yields historically look attractive," said Martin.