The term "Asset-Backed" fundamentally refers to a financial structure where the value and repayment of a loan or a security are primarily dependent on the cash flows generated by a specific pool of underlying assets, rather than the overall financial strength of the issuing entity.
This concept manifests in two major forms: Asset-Backed Finance (ABF), which is typically private lending, and Asset-Backed Securities (ABS), which are publicly traded bonds.
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