CPDOs: A volatility game


Constant proportion debt obligations have been the talk of the credit market since September's inaugural deal. Now over 16 issues worth almost EUR2 billion have been launched. But this runaway growth comes with caveats: the UK's Financial Services Authority has warned banks against misrepresenting the risks of the products and there are questions about whether the premise of CPDOs - a high rating with outperformance - holds up to scrutiny.

The attractions of CPDOs are obvious: a Libor plus 200bp

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

If you already have an account, please sign in here.

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here