Traditionally, Wall Street has categorized financial instruments using the following classification:
- Fixed income
- Emerging markets
- Mortgage-backed securities (MBS)
- Foreign exchange (FX)
These categories are often referred to as asset classes. Fixed-income assets include all sorts of high-quality government bonds and interest-rate products from the G7 countries. The main source of risk here is interest-rate uncertainty. Bonds issued from emerging market countries such as the BRIC (Brazil, Russia, India, China) counties fall under emerging markets. Corporate bonds are classified under ...