TD Securities: US Investment-Grade Corporate Bonds Now Cheaper
Fazen Markets Research
AI-Enhanced Analysis
March 13, 2026 at 9:45 PM UTC
Quick take
TD Securities advises investors to consider increasing allocation to corporate bonds. US investment-grade bond spreads averaged about 90 basis points above benchmark Treasuries as of Thursday’s close, up from roughly 71 basis points in early February. TD Securities called the new level "much more reasonable" in a Friday note.
Key data
- Date/time: March 13, 2026, 9:45 PM UTC
- Investment-grade spread: ~90 basis points above benchmark Treasuries (Thursday close)
- Early February spread: ~71 basis points
What TD Securities is saying
TD Securities signals that the widening of credit spreads to ~90 bps has changed the risk/reward profile for US investment-grade corporate bonds. The firm describes the current spread level as "much more reasonable," indicating a potential entry point for investors seeking carry and credit exposure.
Yield context
A spread of ~90 basis points over Treasuries means additional yield compensation for credit risk relative to government debt. The roughly 19 bps widening from early February (71 bps to ~90 bps) represents the move TD identifies as improving relative value in the investment-grade corporate sector.
Investment implications
- Income opportunity: Wider spreads increase prospective incremental yield for corporate bond investors compared with similar-duration Treasuries.
- Risk/return balance: TD’s guidance implies that, at current spreads, incremental yield may more adequately compensate for credit and liquidity risk than it did when spreads were nearer 71 bps.
- Tactical consideration: Investors focused on fixed income allocation, duration management, and credit selection may find selective increases to corporate exposure worth evaluating.
Tickers and context
- TD (TD) — TD Securities’ analysis underpins the view on US investment-grade corporate bonds.
- UTCTD, PM, US — relevant tickers to monitor for specific issuer credit moves or broader market liquidity; incorporate issuer-level research before adjusting positions.
Risk note
Widening spreads reflect market pricing of credit and liquidity risk. This summary presents TD Securities’ view and the spread data cited; investors should conduct issuer-level credit analysis and consider duration, liquidity, and portfolio constraints before repositioning.
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