ANGL May Be A Riskier Investment Than One Might Expect

Michael Del Monte
4.98K Followers
(7min)

Summary

  • ANGL invests in high-yield bonds that were formerly investment-grade, offering attractive yields but with elevated risk from recent downgrades.
  • Large portfolio concentrations in Celanese and Nissan heighten risk, as further credit deterioration in these firms could significantly impact ANGL's performance.
  • While ANGL offers a competitive 6.28% yield and low fees, alternative ETFs like FALN have outperformed with similar cost structures.
  • Given concentrated credit risk, economic uncertainty, and volatility, I am assigning ANGL a SELL rating despite its yield appeal.
Sculpture of Fallen angel (Angelo caduto), Pisa, Italy

izzzy71

The VanEck Fallen Angel High Yield Bond ETF (NASDAQ:ANGL) is a bond portfolio strategy that seeks to invest in high quality, high-yield bond issuances that were issued as investment-grade corporate bonds.

In general, investment-grade [IG] issuances are seen as higher quality and safer

This article was written by

4.98K Followers
Michael Del Monte is a buy-side equity analyst with over 5 years of industry experience. Prior to working in the investment management industry, Michael spent over a decade in professional services working across industries that include O&G, OFS, Midstream, Industrials, Information Technology, EPC Services, and consumer discretionary.Investment recommendations are built upon the entirety of the investment ecosystem rather than considering a company independently.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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