- CFA Exams
- CFA Level I Exam
- Study Session 17. Portfolio Management (2)
- Reading 46. Economics and Investment Markets
- Subject 4. Credit Premiums and the Business Cycle
CFA Practice Question
When credit spreads are widening, which type of bonds will tend to perform the best?
A. Government bonds
B. Higher-rated corporate bonds
C. Lower-rated corporate bonds
Explanation: Government bonds tend to outperform corporate bonds as the business cycle turns down and credit spreads widen.
User Contributed Comments 0
You need to log in first to add your comment.