Bonds & rates
Fallen angel
A bond downgraded from investment grade to high yield.
How it works
The downgrade forces selling by holders whose mandates prohibit sub-investment-grade debt, often at depressed prices, regardless of the analysis.
That forced selling is a recurring source of opportunity for buyers who are not constrained, and a recurring source of loss for the sellers.
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Educational reference only. Nothing here is investment advice or a recommendation to buy or sell anything, and tax treatment depends on your own circumstances and the country you are in.