Speculative-grade debt offers an attractive buying opportunity for investors as relative yields on the securities are elevated, according to Martin Fridson, global credit strategist at BNP Paribas Investment Partners.
Investors in junk bonds will lose a yield cushion of more than 1.5 percentage points as the Federal Reserve winds down its unprecedented quantitative easing program that’s bolstered credit markets for five years, according to Martin Fridson.
Corporate debt is “fairly valued” even as the Federal Reserve is poised to hold down interest rates for too long, stoking higher inflation and hurting savers, according to Martin Fridson, global credit strategist at BNP Paribas Investment Partners.
Almost $1.6 trillion of junk bonds globally will default between 2016 and 2020, according to Martin Fridson, chief executive officer of New York-based FridsonVision LLC, a research firm specializing in speculative-grade debt.
Yields on speculative-grade bonds are justified by expectations for the economy and the ability of companies to meet their debt obligations, according to BNP Paribas Asset Management’s Martin Fridson .