The actively managed WisdomTree Mortgage Plus Bond Fund (MTGP ) answers the bell. One of the benefits of ABS, including MBS and funds like MTGP, is that these bonds typically carry floating rates. That means they’re less vulnerable to interest rate shocks than traditional fixed-rate debt. “One of the features is the floating rate. Here we don’t have any duration. All the assets are floating rate notes. So, it might be good to have this type of asset as a diversification,” noted David Favier of BNP Paribas. As the fund manager points out, another benefit associated with asset-backed bonds — one applicable to the bonds held by MTGP — is that this form of debt is backed by assets. That implies some level of protection for investors. That’s particularly so when buying highly rated ABS and those at the top tier of the issuer’s capital structure.