Understanding contagion mechanisms is important to identify key factors that may have predictive information value or confirmatory information value for market trading. After reviewing the current literature on financial contagion, this article focuses on specific characteristics of junk bonds that are particularly sensitive to contagion situations. Next, it proposes a new framework to disentangle factors that may act as predictive and proactive and those that may represent confirming information and reactive effects. It then discusses some historical situations as evidence of how such factors may have manifested themselves in practice. Finally, it concludes by discussing the use of the proposed framework, and what directions it can offer for new developments by other scholars.