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ABS: coming in from the cold

Asset-backed securities were widely blamed for fuelling the financial crisis, but the frosty attitude towards investing in them is melting

Complex financial products formed by bundled-together loans have enjoyed a revival among fund managers who have been attracted to better value deals and improved transparency.

The reputation of securitisation, which involves the creation of financial products backed by mortgages, credit card loans and automobile loans, took a battering after 2007 when several investment banks and hedge funds were found to be holding onto large amounts of toxic sub-prime securities.

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