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Preferred term

securitization  

Definition

  • Securitization is the process of creating securities from other assets by pooling and repackaging them. Assets are combined into a pool that is split into shares, ideally structured in such a way as to reduce credit risk and improve profit, though securitized assets are indeed considerably more volatile than many other types because of the amortizing cash flows that back them and the possibility of debt-backed securities being at risk when that debt is defaulted upon. [Source: Encyclopedia of Business in Today's World; Securitization]

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URI

https://concepts.sagepub.com/social-science/concept/securitization

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