New York
WHEN a unit of a Texas power giant filed for bankruptcy this year, investors did not go looking for bargains. Because the company was saddled with US$40 billion in debt from a boom-era buyout in 2007, the virtual "buyer beware" tag on its leveraged loans kept even the most brazen risk-seekers at bay.
With the exception, that is, of a US$6 billion exchange-traded fund. The troubled loans of the Texas utility - Texas Competitive Electric, a subsidiary of Energy Future Holdings - now represent one of Invesco fund's largest positions.
Exchange-traded funds, or ETFs, are bundled pools of assets, ranging from stocks and bonds to currencies and derivatives, that are bought and sold on equity markets...
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