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CDO

A CDO is a collateralized debt obligation or collateralised debt obligation known collectively as CDOs. CDOs are a type of asset-backed security or structured credit product that offers exposure to the credit of a portfolio of fixed income assets, such as corporate or government debt, loans, asset-backed securities (ABS), including mortgage-backed securities (MBS) such as CMBS and MBS, known as CDOs of ABS or ABS CDOs, or other CDOs, known as CDO-squared or CDOs of CDOs. CDOs can be cashflow CDOs (referencing real assets) or synthetic CDOs (referencing credit derivatives, such as CDS) or hybrid CDOs (a mix of cashflow and synthetic). Typical CDOs divide the credit risk among different tranches: senior tranches (rated AAA), mezzanine tranches (AA to B) and equity tranches (unrated). Losses are applied in reverse order of seniority and so junior tranches offer higher coupons to compensate for the added risk. However, synthetic CDOs can be structured to offer single-tranche CDOs as well.


  • Running dry

    Euro CLO secondary market update

    The European CLO primary pipeline is running dry. Traders are increasingly looking at BWIC activity...

    Market Reports    14 December 2018
  • Selling spike

    US CLO market update

    There has been a spike in selling of investment grade paper on the US CLO secondary market, coming m...

    Market Reports    11 December 2018
  • Reaching capacity

    New CLO managers continue flocking to Europe

    Seven new CLO managers are warehousing assets, with European CLO platforms ready to issue in 1Q19. M...

    News Analysis    7 December 2018
  • Deals pulled?

    US CLO market update

    Several US CLO deals are believed to have been pulled from the pipeline and pushed back to 2019, ami...

    Market Reports    6 December 2018
  • Cheaper deals

    European CLO market update

    The European CLO market seems stronger than it was last week, but still relatively volatile. &...

    Market Reports    5 December 2018
  • Print and sprint

    US CLO market update

    US CLO BWIC activity is booming ahead of tomorrow’s market holiday in honour of former pre...

    Market Reports    4 December 2018
  • Sustainable growth?

    Prospects for green CLOs examined

    Green CLOs are expected to play an increasing role in the private sector’s involvement in...

    News    4 December 2018
  • Proportional approach

    ESAs tackle delay in transparency requirements

    The joint European Supervisory Authorities (ESAs) - which consist of the EBA, ESMA and the European...

    News    4 December 2018
  • SCI Start the Week - 3 December

    A review of securitisation activity over the past seven days

    Market commentary European ABS activity remained subdued last week, with spreads drifting wider, du...

    News    3 December 2018
  • UK SLABS slated

    Sector developments and company hires

    EMEA Eurocastle Investment has appointed Hammad Khan to its board as a non-executive director, inc...

    Market moves    23 November 2018
  • Softening activity

    European CLO market update

    The European CLO market is relatively quiet due to the Thanksgiving holiday in the US, but the pipel...

    Market Reports    22 November 2018
  • CRT tranche downgraded

    Sector developments and company hires

    Acquisitions Spruce Finance has been acquired by HPS Investment Partners. Spruce will be headquart...

    Market moves    21 November 2018
  • Hesitant appetite

    US CLO market update

    US CLO equity and double-B bonds were casualties of the drop in the S&P 500 index yesterday,...

    Market Reports    21 November 2018
  • Buyer fatigue

    US CLO secondary market update

    The US stock market is 400 points down today (20 November) and is being described as an “u...

    Market Reports    20 November 2018
  • Long goodbye

    First non-Libor linked ABS anticipated

    Lloyds became the first bank to issue a benchmark covered bond tied to the sterling overnight index...

    News Analysis    20 November 2018
  • SCI Start the Week - 19 November

    A review of securitisation activity over the past seven days

    Market commentary Pepper Group is prepping an Australian RMBS that is expected to include a short U...

    News    19 November 2018
  • Winding down?

    US CLO market update

    The US CLO primary market is seeing steady issuance as the remaining trading days continue to expire...

    Market Reports    15 November 2018
  • SCI Start the Week - 12 November

    A review of securitisation activity over the past seven days

    Market commentary The Dilosk No. 2 Irish legacy RMBS was in focus in the European primary market la...

    News    12 November 2018
  • Unpredictable factors

    Macro and micro challenges highlighted

    European market participants are facing three unpredictable factors in 2019, all of which will drive...

    News Analysis    9 November 2018
  • CLO investor poached

    Company hires and sector developments in structured finance

    Acquisitions LibreMax Capital has entered into an agreement to acquire Trimaran Advisors and certa...

    Market moves    9 November 2018
  • Midterm market

    US CLO market update

    High new issue volumes continue in the US CLO market, with managers paying more to get their deals a...

    Market Reports    8 November 2018