As markets continue to grapple with the economic fallout from the COVID-19 outbreak, the Federal Reserve has been quick to implement unprecedented levels of stimulus. Just recently, the Fed announced on April 9 a new mandate allowing it to purchase fallen angels, companies downgraded from investment-grade rated to below investment-grade rated, a previous source of consternation.
In this note we discuss the opportunity, even without Fed intervention, that we see in fallen angels and assert that they are not the demonic risk that many may believe.
