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Investing Glossary:
Collateralized mortgage obligation (CMO)
Copyright 2010,
Campbell R. Harvey. All Rights Reserved.
Do not reproduce without explicit permission.
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| Term: |
| Collateralized mortgage obligation (CMO)
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| Definition: |
| A security backed by a Pool of pass-through rates , structured so that there are several classes of bondholders with varying maturities, called tranches. The Principal payments from the Underlying pool of Pass-through securities are used to Retire the Bonds on a priority Basis as specified in the prospectus. Related: Mortgage pass-through security.
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