Tranche

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Tranche

One of several related securities offered at the same time. Tranches from the same offering usually have different risk, reward, and/or maturity characteristics.

Tranche

A part of an issue. A tranche sometimes refers to a single issue of a security released at different times. For example, a company may announce that is intends to issue $10,000,000 in bonds in two tranches of $5,000,000. Tranches are important to collateralized mortgage obligations, which are backed by pools of mortgages. These mortgages are arranged in tranches that mature at different times, for instance in 10 years, 15 years, and 30 years.

tranche

A class of bonds. Collateralized mortgage obligations are structured with several tranches of bonds that have various maturities.

Tranche.

Certain securities, such as collateralized mortgage obligations (CMOs), are made up of a number of classes, called tranches, that differ from each other because they pay different interest rates, mature on different dates, carry different levels of risk, or differ in some other way.

When the security is offered for sale, each of these tranches is sold separately.

Similarly, a large certificate of deposit (CD) may be subdivided into smaller certificates for sale to individual investors. Each smaller certificate, or tranche, matures on the same date and pays the same rate of interest, but is worth a fraction of the total amount.

tranche

A class of securities. Collateralized mortgage backed securities are usually divided into tranches according to seniority and risk.

References in periodicals archive ?
OTC: DMXP) has received and banked the first traunche of proceeds resulting from its financing agreement.
White also outlined significant developments, including the filing of new patents for the Company's unique technology, and the recent closing of a second financing traunche of approximately $3 million, which followed an earlier traunche also totaling approximately $3 million.
The first traunche of funding for $650,000 has been completed in the form of a secured convertible debenture with a fixed conversion price.
In a related development, Cadence announced today that it has received the first $250,000 traunche from the $20 million Limited Partnership credit facility which was previously announced, and will commence drilling a pinnacle reef target at the top of the Canyon Limestone Unit in the northwest corner of its "B" lease within ten days.
Under the terms of the agreement with investors arranged through Sunrise Securities Corporation of New York City, the facility is structured as a limited partnership which can be funded in traunches, beginning with an initial traunche of $250,000, with a priority payback of funds to the investor and an 11% preferred return, among other non-equity terms.