Distressed Debt Investing

Distressed debt investing involves buying the bonds or loans of companies that are experiencing financial trouble or are near bankruptcy. Investors purchase these debts at a significant discount, betting that the company will recover or that they can profit from restructuring or changes in the company's situation. If successful, they may gain high returns, but it also comes with increased risk, as the company could fail to turn around or even default. Essentially, it's a high-stakes strategy that seeks value in companies' toughest times, aiming to benefit from their eventual recovery or restructuring.