Or will it result in immense disappointment - akin to buying a lottery ticket and then experiencing the unfulfilling shock when you don't win? After all, why am I able to snatch up a whole bunch of these bonds if they're not completely worthless?
Thankfully, I've got my asset allocation strategy all planned out, which I am sticking to. That should minimise the disappointment. Moreover, I am using a very conservative approach to calculate how much each bond might actually be worth.
I plan to top up on distressed debt whilst the market's still around. When the economy improves, the distressed debt market will probably cool down. I highly recommend reading the Lawrence G. McDonald "A Colossal Failure of Common Sense" book if you're remotely interested in distressed debt. I found it such a fascinating read and learned so much about distressed companies.
The only real disadvantage of distressed debt investing would probably be the taxes and the long wait. The process could take years, although some retailers have emerged out of Chapter 11 relatively quickly.
I just keep daydreaming about getting future equity in Lehman... with their 49% stake in Neuberger Berman, I would be one lucky woman!
Lehman, my Dr. McDreamy look-alike knight in shining armour?
I'll be on Cloud 9...
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