Recent Developments in Collateralised Debt Obligations in Australia1
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چکیده
The collateralised debt obligation (CDO) market has grown rapidly, both globally and in Australia, over recent years. CDOs are securities that are issued against a pool of assets that can include bonds, loans or asset-backed securities (ABS) including other CDOs.2 Increasingly, this exposure is being created synthetically by the use of derivatives written on these assets, rather than physically holding the assets. Moreover, a growing share of CDOs have been backed by tranches of other ABS – these are known as ‘CDOs of ABS’. In the United States in particular, these products have been closely associated with the recent strains in fi nancial markets.
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