The Cdo tranche with a credit rating status between senior and subordinated bond class- es is called the:
A) equity tranche.
B) residual tranche.
C) mezzanine tranche.

Question

Quizplus · Accepted Answer

The tranche with a credit rating status between senior and subordinated bond classes is called the mezzanine tranche. The equity tranche is the riskiest tranche with no credit rating and the residual tranche is the last tranche that absorbs any remaining losses after all other tranches have been paid in full.

The Cdo Tranche with a Credit Rating Status Between Senior