Investors are sticking to the mantra of follow the Fed – buying any securities and assets eligible for the central bank’s asset purchasing and emergency lending programs set up to combat the coronavirus pandemic.
Analysts say one of the clearest ways this simple strategy has played out has been in the narrowing yield difference between the lowest rated debt in the investment-grade universe and the highest rated debt in the non investment-grade universe, or “junk” bonds, as shown below.
