Question: explain in an easier way Asset Backed Security (Simplified) ABS Asset 1 Asset 2 Asset 3 Senior Tranche Principal: $75 million Return = 6% !

explain in an easier way

explain in an easier way Asset Backed Security (Simplified) ABS Asset 1

Asset Backed Security (Simplified) ABS Asset 1 Asset 2 Asset 3 Senior Tranche Principal: $75 million Return = 6% ! SPV Mezzanine Tranche Principal:$20 million Return 10% Asset n Principal: $100 million Equity Tranche Principal: $5 million Return 30% A 'waterfall' defines the precise rules for allocating cash flows to tranches

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