junk bond
(FINANCE) originally, a bond rated as not investment grade by a credit rating agency (e.g., Standard & Poor, Ernst & Young, or Moody's).

Later, a bond was a financial instrument deliberately created to have absurdly high levels of risk (of default), which was then priced in and "hedged" by a fund manager. Junk bonds are routinely used to finance leveraged buyouts.
Michael Milken was the junk bond innovator who figured out how to make them an effective investment vehicle. Yes, he later went to jail for securities law violations.