Bond collateral
Property or claims out of whose value holders are paid if the issuer stops paying.
How to read the number
A secured issue differs from an unsecured one not in the likelihood of a missed payment but in how much can be recovered after one.
When the metric lies
Collateral is valued at the moment it is needed, which is the worst moment in the market. The appraisal at placement and the proceeds at enforcement almost never agree.
Also known as: pledge on an issue, secured bond collateral