Asset-Backed Securities (ABS) are financial instruments backed by loan paper or accounts receivable originated by banks, credit card companies, or other providers of credit, often enhanced by a bank letter of credit or by insurance coverage from a third party.
A Collateralized Mortgage Obligation (CMO) is a type of mortgage-backed security that splits mortgage pools into different maturity classes, called tranches, to optimize the distribution of interest rate and prepayment risk among investors.
A collateralized mortgage obligation (CMO) is a type of mortgage-backed security that combines multiple mortgage loans and separates them into tranches based on maturity and risk.
