Investors are taking on more risk—and are doing it in a major way. Bond funds, which should be your anchor-to-windward money, are loading up on junk. The below investment grade waste piling up in the 10 largest bonds funds is shocking. We’re not talking small potatoes here. These are the big dogs.

“Who wants an index fund that yields 2%?” said Jeffrey Gundlach, manager of the Total Return Bond fund at DoubleLine Capital LP. Investors “want exposure to these high-yield and distressed securities and they’ve become comfortable with what we’re doing,” he told the WSJ.

I’m not buying it.

In my close to 20 years in speaking with investors, they are never comfortable with losing money, period. It’s crucial that you pay attention to how Vanguard bond funds, which comprise five of the top ten slots, have basically zero exposure to junk. That’s one of the many reasons I advise some of these funds for clients and the same for you.

More from an excellent WSJ piece by Matt Wirz:

One concern for regulators is that if hit with a wave of redemptions from investors, the funds could have trouble unwinding their bets in the smaller high-yield markets, where trading can dry up quickly when prices start to fall.

“Sales of assets from any of those funds could create contagion effects on the related funds, spreading and amplifying the shock and its market impacts,” the Treasury said in a September report on the systemic risk posed by large fund managers.

The prospect of fire sales of bonds by large funds “may create trouble in terms of transmitting crisis from one sector of the fixed-income market to another,” said Massimo Massa, a professor at French business school Insead who studies the impact of mutual funds on markets.

Five of the top 10 bond funds by assets are managed by Vanguard, each with less than 1% invested in high-yield securities. Vanguard, based in Valley Forge, Pa., said it can offer competitive returns without buying risky debt because it charges lower management fees than competitors.

Pimco’s Total Return Bond Fund is the world’s largest and has long posted market-beating returns, but it lagged behind many rivals last year as interest rates climbed. Investors have pulled $55.3 billion from the fund since May of last year, when the Fed said it would ratchet back its bond-buying program. All told, assets in the fund posted a 17% decline last year.