From the blog: Corporate bonds issued by companies perceived to be under financial stress are currently trading at very low prices. This could be an attractive investment opportunity.
The opportunity is hiding in a corner of the high-yield debt market referred to as ‘stressed’ bonds – corporate bonds that have fallen significantly in price, typically below 80c of par value ($1), but which unlike ‘distressed’ bonds have not actually defaulted.
The fall in price has usually occurred because the market believes the risk of default has increased.