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Hot U.S. Housing Bonds Are Getting Riskier

Claire Boston
Hot U.S. Housing Bonds Are Getting Riskier

Riskier U.S. mortgages are creeping back into the bond market again. If the housing market weakens, and unemployment starts rising, mortgage bond investors could find their securities losing value, money managers warn. “Underwriting starts out very strict and as time goes on, it’s kind of the proverbial frog in the pot of boiling water,” said John Kerschner, head of securitized products at Janus Henderson Group Plc, which manages $372 billion.