CDO-Squared
CDO-Squared is a collateralized debt obligation backed primarily by the tranches issued by other CDOs. These instruments became popular before the financial crisis of 2007–08. There were 36 CDO-Squared deals made in 2005, 48 in 2006 and 41 in 2007. Merrill Lynch was a big producer, creating and selling 11 of them.
The collapse of the market for collateralized debt obligations and CDO-Squared contributed to the 2008 subprime mortgage crisis. Goldman Sachs appears to be the last bank to hold CDOs-Squared, holding $50 million (~$57.7 million in 2022) in June 2018.
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