New investors make credit an asset class

Ever broader arb opportunities

A high-yield takeoff

KEVIN AKIOKA LIKES credit derivatives. In the past 18 months he has become much more comfortable investing in a product that he once would have regarded with scepticism. That’s significant because his company is neither a hedge fund nor a total-return fund but a regular mutual fund with $50 billion in assets under management based in Los Angeles called Payden and Rygel. “Credit derivatives have definitely become a real market, and that’s not something I would have said a few years ago,” says Akioka, a senior fixed-income strategist.