I have adopted a new bond strategy, to take advantage of high interest rataes. I buy a highly discounted bond, because of it's lower coupon and iffy fundamentals--as well as a call date in three years or less, then collect the coupon, hoping the bond is called (and I receive the full face value of the discounted bond), or wait for interest rates to decrease.
However, I did not factor in that in the face of a downturn, my BBB rated bonds may fall instead of rally, like a treasury. I am now only buying AA or higher bonds.
Is the latter assumption of a downturn and BBB bonds correct?