Fallen Angels Bonds Outperform High Yield Market in Q3 2025
Fallen angels bonds eclipsed the broader high yield market in Q3 2025, fueled by strategic security selection and new entrants like Huntsman International. VanEck attributes the outperformance to longer duration exposure and rigorous credit curation.
The Fallen Angels Index expanded with four additions, including WarnerMedia, reflecting robust fundamentals that continue to attract capital. Market participants anticipate sustained spread compression heading into year-end.
Federal Reserve policy shifts and lingering trade tensions created ideal conditions for duration plays. Once-investment-grade debt now trading as junk has become an unlikely beneficiary of the current macroeconomic landscape.