Collateralized Debt Obligation Cubed - CDO-Cubed

外汇网2021-06-19 20:57:05 149

A special purpose vehicle (SPV) with securitization payments in the form of tranches. 9119.html">Collateralized debt obligation cubeds (CDO-cubeds) are backed by a pool of collateralized debt obligation squared (CDO-squared) tranches.

|||These CDOs are identical to regular CDOs except for the assets securing the obligation. Unlike a CDO, which is backed by a pool of bonds, loans, and other credit instruments, CDO-cubeds are backed by CDO-squared tranches. CDO-cubeds allow the banks to resell the credit risk that they have taken once again by repackaging their CDO-squareds.

CDO-squareds and CDO-cubeds can be repackaged countless times to create derivatives that quite different from the original underlying debt security. These are also referred to as CDO^n, to show the unknown depth of some of these securities.

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