Do Current Valuations Compensate Investors for Increased Default Risk?
As COVID-19 and the ongoing oil price spat between Riyadh and Moscow continues to wreak havoc on markets across the world, the spreads on high yield assets in both EM and DM have widened significantly. With many companies seeing their revenues take a beating at countries go into lockdown, and with many sovereigns juggling their need for fiscal stimulus with already lopsided public finances, Iain Stealey, International head of Global Fixed income at JP Morgan Asset Management explores whether valuations fairly reflect higher default risk.
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