In the pre-derivatives world, investors in mortgage-backed securities or real-estate asset-backed securities had two options: either to buy particular pools of collateral, or not to buy them. Shorting a position or buying protection were out of the question.
But by mid-2005 those limitations had changed as investors welcomed the birth of credit default swaps on asset-backed securities, known colloquially as ABCDS. These new synthetic instruments acted as credit default swaps on individual hom
The week on Risk.net, July 7-13, 2018Receive this by email