Risk 's Derivatives and Risk Management Summit Europe 2006: Dealers may face new raft of CDO litigation

Widespread litigation is more likely to occur if a credit dislocation similar in scale to that witnessed last year takes place in the near future, as inexperienced investors could face large losses, panellists said.

Investments in CDOs have picked up of late as investors look for alternative ways to generate alpha amidst low interest rates and unstable market conditions – many are pension funds and individual investors that have only entered the market in the past 12 months.

JP Morgan last week