Asset Backed Securities Vs MBS

This question tests your understanding of securitisation, a core concept in capital markets and sales and trading. You need to recognise how pools of loans or receivables can be packaged into tradable securities, and how investors think about the cash flows, collateral, and credit risk behind those instruments. Interviewers ask this because it checks both technical knowledge and whether you can distinguish between related product categories clearly and precisely. It also helps show that you understand how market terminology is used in practice, not just in theory.