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Collateralized debt obligation  (CDO) - Financial definition

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Translations:      FR  obligation de dette collatéralisée (n.f.)     ES  obligación de deuda garantizada (n.f.)     DE  Collateralized Debt Obligation (n.f.) 

Concise definition of the term collateralized debt obligation

A CDO is an asset-backed security backed by a diversified pool of debt securities.

Comprehensive definition of the term collateralized debt obligation

CDOs are classified as either cash CDOs or synthetic CDOs.
A cash CDO is backed by a pool of cash market debt securities. Synthetic CDOs also give the investor exposure to a pool of cash market debt instruments, but through the use of credit derivatives rather than the purchase if the cash market instruments.

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