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Scary Bonds From Last Crisis Were the Best Place to Hide in 2018

  • Securitized debt outperformed amid a sea of red for credit
  • Top mutual fund returned 7% on consumer debt bets like loans
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With Stocks on Brink of Bear Market, Is It Time to Buy?

The securities that triggered the last financial meltdown are proving to be one of the best places to hide in this downturn.

Bonds backed by loans like auto and credit-card debt have gained 1.6 percent this year through Monday, according to Bloomberg Barclays indexes. Some portions of the market for repackaged debt are doing even better: bonds supported by home loans without government backing have gained more than 11 percent in 2018. Those are eye-popping returns after U.S. equities are on track to be down more than 10 percent.