Goldman Sachs: The magic CDO mix is now revealed
It's often the smaller deeds that prove most important in the long run, and that is what Goldman Sachs is hoping will be the case with a new data service it is launching.
The bank is making available all information about all the collateralized debt obligation (CDO) deals it has underwritten. It's that simple. All qualified investors interested in the market, as well as all underwriters, can access the information from a market data system called Intex that specializes in asset-backed securities. It is best known for disseminating data on asset-backed and commercial mortgage-backed deals, and has been moving into the CDO space in the past 18 months.
CDOs are among the least transparent of capital market products. For one thing, most are 144a-registered private-placement deals, so access to information is limited anyway. But the asset managers who run the portfolios and the investment bankers who help structure them are renowned for trying to keep as much information secret as possible. "Some see it as their own magic mix that they don't want revealed," quips one banker.
Alex Reyfman, one of the Goldman bankers who worked on the project, says: "If brokers wanted to bid in the secondary market on a deal which they hadn't underwritten, they'd practically have to reverse engineer it because of the lack of usable public information.