Even in good times, it's not unusual for companies clinging to the bottom rung of the investment-grade ladder to become fallen angels. Yet concerns surrounding fallen angels are especially pronounced today, and not just because of the coronavirus pandemic and concurrent oil crash. During the past decade, the volume of debt rated BBB - the lowest rank of investment grade - ballooned as a share of the investment-grade universe as issuers ramped up their leverage.
Given the sudden onset of liquidity challenges and reduced access to capital in today's environment, we estimate that 8.5% of