collateralized bond obligation (CBO)
An investment grade debt instrument that is backed by a portfolio of high-yield, risky bonds. Bonds backing a CBO can range in quality but typically hold a bond rating below BBB, classifying the underlying assets as junk bonds. Taken individually, the holdings in the portfolio are rated high risk, but depth and diversification of the mix of assets mitigates sufficient risk to raise the bond rating of a CBO to investment grade.
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multiple exchange rate
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