Asset-Backed Security - ABS

AAA

DEFINITION of 'Asset-Backed Security - ABS'

A financial security backed by a loan, lease or receivables against assets other than real estate and mortgage-backed securities. For investors, asset-backed securities are an alternative to investing in corporate debt.

INVESTOPEDIA EXPLAINS 'Asset-Backed Security - ABS'

An ABS is essentially the same thing as a mortgage-backed security, except that the securities backing it are assets such as loans, leases, credit card debt, a company's receivables, royalties and so on, and not mortgage-based securities.

RELATED TERMS
  1. A-Note

    The highest tranche of an asset backed security or other structured ...
  2. Unitranche Debt

    A type of debt that combines senior and subordinated debt into ...
  3. Lewis Ranieri

    Former bond trader and former vice chairman of Salomon Brothers ...
  4. Structured Investment Vehicle - ...

    A pool of investment assets that attempts to profit from credit ...
  5. Corporate Bond

    A debt security issued by a corporation and sold to investors. ...
  6. Interest Only (IO) Strips

    The interest portion of mortgage, Treasury or bond payments, ...
Related Articles
  1. Behind The Scenes Of Your Mortgage
    Insurance

    Behind The Scenes Of Your Mortgage

  2. The Bond Market: A Look Back
    Mutual Funds & ETFs

    The Bond Market: A Look Back

  3. Asset Allocation In A Bond Portfolio
    Bonds & Fixed Income

    Asset Allocation In A Bond Portfolio

  4. Why Are Mortgage Rates Increasing?
    Personal Finance

    Why Are Mortgage Rates Increasing?

comments powered by Disqus
Hot Definitions
  1. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  2. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  5. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  6. Budget Deficit

    A status of financial health in which expenditures exceed revenue. The term "budget deficit" is most commonly used to refer ...
Trading Center