Investments, tenth edition

  Asset-Backed Bonds   

Miramax once issued bonds with coupon rates tied to the finan-

cial performance of  Pulp Fiction  and other films. Domino’s Pizza has issued bonds with 

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Final PDF to printer

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  Bond Prices and Yields

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payments backed by revenues from its pizza franchises. These are examples of asset-backed 

securities. The income from a specified group of assets is used to service the debt. More 

conventional asset-backed securities are mortgage-backed securities or securities backed by 

auto or credit card loans, as we discussed in Chapter 2.