"Fallen angels" are corporate bonds that received investment-grade credit ratings when they were issued but have since been downgraded to junk. Historically, they have tended to exhibit greater ...

The positive momentum gained by fallen angels in the final quarter of 2023 carried over into January, surpassing broad high yield by 56bps. Sector-specific weakness may continue to manifest in ...

2024 returns will likely be driven by carry, with sector and quality differences driving potential outperformance versus broad high yield. An uptick in fallen angels may provide further support.