Securitized Assets: A Primer

Monday 01 July 2019

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  • Securitized assets are financial instruments that are backed by residential mortgages, commercial mortgages, consumer loans and other diverse assets.
  • Because securitized assets provide concentrated exposure to specific and unique risks, they can be an important tool in constructing an efficient fixed income portfolio.
  • Benchmark-focused investors are sometimes under-allocated to the securitized sectors that offer greater yield potential and diversification benefits.1
  • Securitized assets were at the epicenter of the 2008 global financial crisis. Though much has changed, the asset class remains misunderstood.
  • With over 30 years of history in this asset class, we believe the secret to pursuing success in securitized assets is experience and agility.


Our Approach to Securitized Assets

Amundi Pioneer has managed securitized assets for over 30 years.2 We blend sophisticated quantitative tools with common sense qualitative analysis in a bottom-up security selection process that pursues alpha, while also informing our top-down sector and risk positioning. We believe the secret to success in securitized assets is experience and agility. Consequently, each member of our seasoned team of eight experts specializes in an asset class, not a job function. By concentrating the roles of sector strategist, credit analyst and trade execution, we seek to make each investment decision an informed one while we avoid the inefficiencies and inertia that can commonly befall a vertical silo approach in securitized assets.

1 Diversification does not assure a profit or protect against a loss.

2 As of 6/30/19

Securitized assets may increase or decrease more than other fixed-income securities during times of fluctuating interest rates. Mortgage-backed securities are also subject to pre-payments.

The views expressed regarding market, economic and political trends are those of the author or third-party sources identified in the article, and not necessarily Amundi Pioneer Asset Management, and are subject to change at any time based on market and other conditions and there can be no assurances that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, as securities recommendations, or as an indication of trading on behalf of any Amundi Pioneer Asset Management product. There is no guarantee that market forecasts discussed will be realized or that these trends will continue. Investments involve certain risks, including political and currency risks. Investment return and principal value may go down as well as up and could result in the loss of all capital invested. This material does not constitute an offer to buy or a solicitation to sell any units of any investment fund or any services.

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