One of the highlights of the evolution of the European structured finance market in 2007 was the emergence of constant proportion debt obligations (CPDO). According to a Fitch analysis: "CPDOs are essentially a variant of CPPI, the main difference being a fixed coupon with no upside and different leverage rules. Like credit CPPIs, CPDOs give leveraged exposure to credit portfolios, although they do not offer principal protection to investors."
In a CPDO, the size of those credit portfolios varies
The week on Risk.net, July 7-13, 2018Receive this by email