Search results
Results From The WOW.Com Content Network
However, the asset manager's role continues even after the ramp-up period ends, albeit in a less active role. During the CDO's "reinvestment period", which usually extends several years past the issuance date of the CDO, the asset manager is authorized to reinvest principal proceeds by purchasing additional debt securities.
Say it ain't so. It wasn't all that long ago the term "collateralized debt obligation" struck fear into the hearts of people everywhere: CDOs being widely known as one of the Wall Street ...
The main difference between CDOs and derivatives is that a derivative is essentially a bilateral agreement in which the payout occurs during a specific event which is tied to the underlying asset. Other more complicated CDOs have been developed where each underlying credit risk is itself a CDO tranche. These CDOs are commonly known as CDOs-squared.
Still another structured product was the "synthetic CDO". Cheaper and easier to create than original "cash" CDOs, these securities did not provide funding for housing. Instead synthetic CDO-buying investors were in effect providing insurance (in the form of "credit default swaps") against mortgage default. Synthetics "referenced" cash CDOs, and ...
CDOs generated enormous paydays for all these companies. I estimate that they received fees totaling between $200 billion ($50 million times 4,000) and $280 billion for the $4 trillion in CDOs ...
Still another innovative structured product most of whose tranches were also given high ratings was the "synthetic CDO". Cheaper and easier to create than ordinary "cash" CDOs, they paid insurance premium-like payments from credit default swap "insurance", instead of interest and principal payments from house mortgages. If the insured or ...
Collateralized debt obligations (CDOs) involve several parties. ... This list is incomplete; you can help by adding missing items. (August 2008) References
A synthetic CDO is a variation of a CDO (collateralized debt obligation) that generally uses credit default swaps and other derivatives to obtain its investment goals. [1] As such, it is a complex derivative financial security sometimes described as a bet on the performance of other mortgage (or other) products, rather than a real mortgage security. [2]