Credit derivatives and securitizations offer high yields and can perform well even if the US economy tips into recession, says Jonathan Dorfman, managing principal and chief investment officer at Napier Park Global Capital. “In credit, for the first time in 15 years, you can actually create portfolios that give equity-like returns,” he tells Bloomberg News’ Lisa Lee and James Crombie and Bloomberg Intelligence’s Tolu Alamutu, in the latest Credit Edge podcast. Standardization and improved transparency have reduced risk in structured credit, which can make better inflation-adjusted gains than corporate bonds, he says. Dorfman also raises concerns about private credit — which doesn’t mark to market — noting “extraordinary” differences in pricing of the same asset by managers. In addition, Alamutu weighs the outlook for real estate as rates stay high for longer. That’s pushing more companies in the sector to borrow in public bond markets, she says. Listen to this episode on Apple Podcasts and Spotify.

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