A different animal: How the asset-backed loan sector has slowly been changing its spots

Asset class adapting and improving

Asset-backed investing has been suffering from bad publicity, writes David Conlon, manager of the GCP Asset Backed Income fund.

The likes of collateralised loan obligations and mortgage-backed securities - the infamous products immortalised in The Big Short - were roundly condemned as one of the root causes of the global financial crisis. Over 10 years later, the world is still feeling the effects of the crisis with interest rates at near-record lows and sluggish growth lingering in some quarters. However, out of crisis, the asset-backed loan sector has been steadily transforming and adapting. Will ABS market ever escape being tagged as driver of GFC? While once a space dominated by the mainstream 'big b...