A Bespoke CDO is a structured financial product that is specifically designed for a particular group of investors. The investors usually purchase a single tranche of the CDO, and the remaining tranches are then held by the dealer. The dealer may attempt to hedge against potential losses by using other financial products, such as credit derivatives. The term "customized CDO" can also refer to a CDO that is created for a particular issuer, such as a company or government. These CDOs are known as "single-name" CDOs, since they are only backed by the credit of a single entity.The benefits of investing in customized CDs include:-1- Increased liquidity - Since these products are tailored specifically for certain groups of investors, they tend to be more liquid than traditional CDs. This means that it's easier to sell your investment if you need to cash out sooner than expected.2- Higher returns - Because there is less demand for customized CDs compared to traditional CDs, issuers often offer higher yields on these products.3- Diversification - By investing in different tranches of customized CDs from different issuers, you can spread your risk across several different credits lines.
