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CDS vs TRS vs CLN

nansverma

Member
This was an interesting and helpful topic to read on. Thanks everyone who contributed. In Crouhy notes on Securitization in Credit Risk Module, Page 31, I think the terminology for CLN is more like WIki :
 In this structure there are no margin calls, and the maximum downside for the investor is the initial investment of $15 million. If the fall in the value of the loan portfolio is greater than $15 million, then the investor defaults and the bank absorbs any additional loss beyond that limit. For the investor, this is the equivalent of being long a credit default swap written by the bank.
 
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