Overview
Global CDO issuance has averaged $137 billion per year for the last three years.
In the context of asset-backed securities (ABS), this figure is about one-half of
public and private U.S. issuance.  This sustained level of activity is remarkable,
given that annual volume never exceeded $4 billion until 1996.  We estimate
outstanding CDO volume at $500 billion.  The current status of CDOs is due to
the acceptance of the product by investors and credit risk hedgers.
This report is a comprehensive introduction to CDOs.  It addresses:
•  the structural components of CDOs;
•  typical CDOs;
•  why CDOs exist;
•  the cash flow and market value credit structures;
•  synthetic CDOs;
•  the asset manager and other parties to a CDO;
•  legal, accounting, and tax considerations;
•  CDO terminology.