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This guide is an introduction to ABS, presented from the point of view of the investor. It proposes a breakdown in simple notions, which enable a partial reading.
I. What is an ABS?
ABS (Asset Backed Securities) are experiencing strong growth on the capital markets. These financial instruments enable companies to raise capital using the securitisation method described below.
1. Securitisation
Securitisation is a way for companies to raise capital and consists in using one of the company's financial assets to guarantee a security issued on the capital markets.