UK Accounting Glossary
An asset-backed security (ABS) is a financial security collateralised by a pool of assets such as loans, leases, credit card debt, royalties or receivables.
An Asset-Backed Security (ASB) is a bond or note whose collateral is the cash flows from a pool of financial obligations such as mortgages, car loans, or credit-card receivables.
An asset–backed security (ABS) is a security whose income payments and hence value are derived from and collateralised (or “backed“) by a specified pool of underlying assets. The pool of assets is typically a group of small and illiquid assets which are unable to be sold individually.
For investors, asset–backed securities are an alternative to investing in corporate debt.
Asset-backed securities (ABS) alongside mortgage-backed securities (MBS) are two of the most important types of asset classes within the fixed-income sector.
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This glossary post was last updated: 7th May 2019.