‘Fallen angels’ pose little threat to EU funds

- Louie Woodall
- 19 Feb 2020

Actively managed bond funds in the European Union would be resilient to a credit shock that turned a hefty chunk of their holdings to junk status – but passive funds would be forced to panic sell, dramatically impacting debt prices.

The European Securities and Markets Authority (Esma) simulated the effects of a sudden blow-out of credit spreads and rating downgrades on EU funds. The scenario

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