Chapter 22: Term Structure of Credit Spreads

In this section

• Determinants of Credit Spread Shapes
  Explore the key drivers influencing the shape of credit spread curves, including default risk, liquidity conditions, monetary policy expectations, and sector-specific factors.
• Rating Transitions and Their Impact
  Explore how credit rating changes can reshape credit spreads, trigger forced selling or buying, and influence portfolio risk management strategies.
• Credit Curve Investing Strategies
  Learn how to position your bond portfolio across different maturities to capitalize on anticipated changes in credit spreads, using strategies like curve steepeners, curve flatteners, and relative value analysis.
• Item Set: Shifts in the Term Structure of Credit Risk
  Explore how credit spreads move across different maturities and learn practical exam strategies for analyzing term-structure shifts. This section covers parallel shifts, slope changes, rating transitions, and real-world factors causing credit-curve volatility.