One of the goals of the head of the Pacific Investment Management Company's mortgage credit portfolio management team is to acquire direct commercial real estate investments and other non-securitized loans. While these loans carry greater risk, they have higher return potential in the long run.

These remarks were made Dan Ivascyn, who also serves as a managing director of the US$2 trillion portfolio management firm. He said the current direction by financial institutions around the world to divest some of their debt has created a market for unrated loans.

In an interview with Reuters, Ivascyn said, "Some of the more complex, illiquid areas are where we still think there is considerable value."

Many fund managers who are seeking high yield stable cash flow streams have translated into returns on instruments ranging from 'junk' bonds to commercial mortgage backed securities. Since these instruments have started to decline in their returns, the further the search has enjoined many to make.