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.

  • 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
  • Market moves update

    Sector developments and new hires in structured finance

    Acquisitions Franklin Templeton has acquired Benefit Street Partners, expanding its fixed income c...

    Market moves    30 October 2018
  • SCI Start the Week - 29 October

    A review of securitisation activity over the past seven days

    Market commentary The US secondary CLO market saw heightened activity last week, with bid-lists cir...

    News    29 October 2018
  • Mixed paper

    US CLO market update

    A BWIC of 68 line items is driving US CLO secondary market activity today, amidst a scarcity of prim...

    Market Reports    26 October 2018
  • Reset end point?

    US CLO market update

    With almost 40 bonds out for the bid today, the secondary US CLO market is seeing heightened activit...

    Market Reports    25 October 2018
  • Eastern incentive

    European CLO market update

    The European CLO market appears to be softening, following high volumes of equity out for the bid in...

    Market Reports    24 October 2018
  • Bridge-loan lifeline

    Greystone closes CRE CLO milestone

    Greystone Bridge Lending Fund last month completed its second CRE CLO (see SCI’s primary i...

    News Analysis    24 October 2018
  • CLOs in demand

    Quarterly SCI data update

    Analysis of SCI's databases underlines the significant demand for CLO paper seen in 3Q18, in...

    News Analysis    23 October 2018
  • Latest SCI podcast now live

    SCI podcast episode two has been released

    SCI’s latest podcast is now live. This month the team discuss the African Development Bank...

    News    18 October 2018
  • SCI Start the Week - 15 October

    A review of securitisation activity over the past seven days

    Market commentary Robust demand was seen in both the European and US CLO markets last week (SCI 9 O...

    News    15 October 2018
  • Market moves - 12 October

    Company hires and sector developments in structured finance

    Cliff edge concerns ISDA has published a paper highlighting widespread concerns in Europe that the...

    Market moves    12 October 2018
  • Manager differentiation?

    US CLO primary market update

    US CLO spreads are tightening, despite increased supply. Fresh primary market issuance is emerging d...

    Market Reports    11 October 2018
  • Casting a wider net

    US CLO managers target European opportunities

    Although considerably smaller than the US, the European CLO market is on course for a post-crisis re...

    News Analysis    10 October 2018
  • Little differentiation

    European and US CLO market update

    Robust demand is being seen in both the European and US CLO markets this week. Equity arbitrage is...

    Market Reports    9 October 2018
  • SCI Start the Week - 8 October

    A review of securitisation activity over the past seven days

    Market commentary The European ABS primary market saw a lull in activity last week, which left some...

    News    8 October 2018
  • Perfect ingredients

    Liquidity boosts Euro CLO pipeline

    Increased liquidity and strong demand suggest that the European CLO pipeline will continue to be bus...

    News Analysis    5 October 2018
  • Double counting

    US CLO primary market update

    Up to 30 US CLO transactions are being prepped in the primary market this week, with four or five se...

    Market Reports    4 October 2018
  • SCI Start the Week - 1 October

    A look at the major activity in structured finance over the past seven days

    Conference SCI’s 4th Annual Capital Relief Trades Seminar is taking place on 16 October...

    News    1 October 2018
  • CDO misconduct alleged

    Goldman Sachs in court over legacy CDO

    Astra Asset Management is suing Goldman Sachs over allegations that the bank engaged in misconduct t...

    News    28 September 2018