Can someone explain this to me please?
In: Economics
Essentially a pool of similar debt, securitized into a asset you can buy in the open market. It’s based off of the underlying cash flows and rents/leases of the companies involved in the security itself. Almost like an ETF, but on the debt side.
It’s an investment that acts like a bond, with buyer collecting interest payments. But instead of a loan to a single government entity or company, it’s a bundle of 1000’s of mortgages, car loans or other loans backed by collateral (ie. can take back asset being financed if payments not made)
Latest Answers