It might not be the safest route, but corporate defined benefit plans may do well investing in medium-rated corporate bonds, according to Standish Mellon Asset Management.
Defined benefit plans typically focus their corporate bond investments on A and higher-rated securities in an effort to insulate their plans from market volatility.
But certain "BBB"-rated paper, which is the lowest rating before a company's debt falls to "junk bond" status, can lead to improved diversification and better returns, according to Standish Mellon, the Boston-based fixed-income specialist for BNY Mellon
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