Collateralized Debt Obligation
/kəˌlætrəˌlaɪzd dɛt əˌbloʊˈɡeɪʃən/
Definitions
- (n.) A structured financial product backed by a pool of loans or debt instruments, divided into tranches with varying risk and return profiles, used for risk redistribution.
The bank issued a collateralized debt obligation to package and sell mortgage loans to investors.
Forms
- collateralized debt obligations
Related terms
See also
Commentary
Collaterized debt obligations often require careful legal structuring and documentation to define rights, priorities, and risks associated with underlying debts.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.