Will the troubles at beleaguered bond insurers MBIA and Ambac help Assured Guaranty , one of only two bond insurers to be rated AAA by all three ratings agencies? The CEO tells Fast Money that he's confident.
Dominic Frederico isn't sure the Fed’s latest actions will necessarily cure all of what ails the credit markets, but its willingness to provide more liquidity will allow certain asset classes to move back into the market and that should restore confidence from the brokerages to the bond insurers.
AGO’s muni bond market share has grown to 14% from 3% a year ago as rivals Ambac and MBIA have had slid. In the last six months, ABK is down 91%, MBI is down 80% and AGO? Down a relatively paltry 8%.
Take that and add in the fact that legendary investor Wilbur Ross just bought a $1 billion stake in the company and – the traders agree – this is a bond insurer that’s actually ahead of the game.