The investor base for collateralised notes of all kinds has broadened considerably over the past eight years. Securitised products are no longer the exclusive preserve of a narrow clique of investors, but have been increasingly appealing to pension funds and insurance companies as well as hedge funds and banks’ proprietary trading desks. Most recently, even private high-net-worth individuals have also become active in the market for CDOs.
So why do investors buy CDOs? After all, it is the in