Barron’s: These Fallen Angel ETFs Could Lift Your Portfolio
May 22, 2020
The economic shock from the COVID-19 pandemic is taking a toll on companies. As noted in this Barron’s article, 36 companies saw their credit ratings lowered from investment grade to junk in March and April. These downgrades may lead to forced selling by big bond investors that have mandates limiting how much non-investment grade debt they can hold. This causes those bond prices to fall and yield to rise, creating a potential buying opportunity for intrepid investors to capture price improvement and income.
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