FALN - FALN: Great Fund But Timing Isn't Right Yet
2024-05-07 16:50:55 ET
Summary
- iShares Fallen Angels USD Bond ETF offers potential for higher yields and price appreciation by investing in downgraded investment-grade corporate bonds.
- The FALN ETF has a well-diversified portfolio and a cost-effective structure, making it an attractive option for income and capital appreciation.
- However, the strategy carries risks such as default risk, interest rate risk, and market volatility, and should be considered after a credit dislocation takes place.
I've been very vocal about my concerns about credit risk being mispriced, and maintain that this is not the time to consider high-yielding junk bonds. There will come a point where the time is right, though, and when that time comes, the iShares Fallen Angels USD Bond ETF ( FALN ) will be worth considering. This bond ETF attempts to capitalize on the potential resurgence of formerly investment-grade corporate bonds that have been downgraded to high-yield status, also known as "fallen angels."...
FALN: Great Fund, But Timing Isn't Right Yet