An Introduction to Securitized Credit

November 2016
Securitized credit (or “structured product”) consists of bonds backed by mortgages, loans, and leases (the “collateral”). It is a diverse asset class that is not well represented within the Bloomberg Barclays (“BB”) Aggregate Index. As such, the asset class is typically underrepresented in institutional investor portfolios. Backed by a diverse range of collateral types, a dedicated structured product allocation may provide investors with diversification benefits, reduction in interest rate risk and an attractive yield. Investors should be aware that a dedicated structured product portfolio may be less liquid, challenging to access, more expensive and difficult to benchmark. This paper discusses the securitization process, opportunity set, and implementation considerations.


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