An asset-backed security (ABS) is an investment vehicle that bundles loans with future payments and converts them into securities. This allows investors to grow their money by owning future income from a "loan portfolio" with a fixed return at low risk.

Advantages

 Certainty

Asset-backed securities are characterized by the fact that they are secured by stable, specific future cash flows of loans. Specifically, bundled loans have a fixed repayment period, a fixed interest rate, and are secured by collateral registered in accordance with relevant laws and regulations.

Investment vehicle

For investors, asset-backed securities are an investment vehicle that provides higher returns and stability compared to other bonds of the same rating. In addition, ABSs allow investors to diversify their portfolios by investing in other markets.

-Management

The portfolio's credit quality indicators and cash availability are regularly monitored by the manager on behalf of investors. Therefore, the risk of interruptions or delays in the source of repayment of the securities is immediately reduced.

-Low risk

As it is secured by a quality loan portfolio, the risk is low.

 Low taxes

The tax on children's income is half that of ordinary savings.