The first cash-out event has occurred in a constant proportion debt obligation, causing 90% losses for investors in one tranche of the deal. UBS’s Series 103 Tyger deal, launched in March 2007, was unwound in late November following widening spreads on the financial credit default swaps the deal was based on.
CPDOs, like mainstream fixed-income instruments, pay regular coupons and principal at maturity. They take leveraged exposure to, typically, credit indices; but Tyger was part of a second gen
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