Capital structure refers to the balance between a company's assets and liabilities, the nature of its assets, and the composition of its borrowings. It is also commonly used in the context of a company's debt-equity ratio and the mix of debt classes in structured finance instruments.
Structured finance refers to the creation of complex debt instruments through methods such as securitization or the incorporation of derivatives to existing instruments. It involves asset pooling, tranching of liabilities, and the creation of special purpose vehicles to mitigate risk.
A tranche is a portion or slice of a larger sum of money or a security with differing risk-return profiles used in financial operations such as loans, funding, and securitizations.
