Credit Derivatives, Insurance, and CDOs: What Enron's Collapse Actually Changed
Book: Structured Finance and Insurance: The ART of Managing Capital and Risk Author: Christopher L. Culp Publisher: Wiley Finance, 2006 ISBN: 978-0-471-70631-1
Credit derivatives
CDOs and How They Shaped Global Capital Markets
Chapter 4 is where Tavakoli steps back from mechanics and tells the story of how the CDO market grew. The chapter is titled “CDOs and the Global Capital Markets” and it covers roughly 20 years of history – from the junk bond era of the late 1980s through the explosive synthetic CDO growth of the 2000s to the beginning of the unraveling in 2007.
Synthetic CDOs: From BISTRO to Single-Tranche Bespoke Deals
Book: Structured Finance and Insurance: The ART of Managing Capital and Risk Author: Christopher L. Culp Publisher: Wiley Finance, 2006 ISBN: 978-0-471-70631-1
Credit Derivatives and Default Swaps: The Basics
Credit derivatives are where Chapter 3 begins, and they’re where the CDO story gets complicated. These instruments – primarily credit default swaps – turned the credit market from a buy-and-hold business into a trading business. They made the CDO market possible at the scale it reached. They also introduced risks that many participants didn’t understand.
Securitization Terminology: What You Need to Know First
Before you can understand CDOs, you need the vocabulary. Chapter 1 of Tavakoli’s book is essentially a glossary with context – she defines the key terms and explains why they exist.
Credit Derivatives and Credit-Linked Notes: CDS, Portfolio Products, and Funded Credit Protection
Book: Structured Finance and Insurance: The ART of Managing Capital and Risk Author: Christopher L. Culp Publisher: Wiley Finance, 2006 ISBN: 978-0-471-70631-1
Credit Derivatives: CDS, CDOs, and the Products That Blew Up
If you hold a bond and the issuer might default, you want insurance. That is the basic idea behind credit derivatives. You pay someone a regular premium, and if the bad thing happens, they pay you. Chapter 41 of Wilmott’s book walks through the main types of credit derivatives, from simple default swaps to the multi-name products that helped blow up the global financial system in 2008.