Rating: 
Summary: 1 Star Reference Book
Review: "Reviewers" of this book are clearly bimodal, 5 stars or 1 star. I really don't think any technical textbook could be rated 5 stars by anyone other than the author touting the book--Tom Clancy perhaps, but not a bone dry technical book. The value of a great technical text is one that offers some great insight, which this book does not, or one that covers the subject matter in such a thorough, fundamental and unbiased matter as to be considered a reference text. On the second measure, the author in her book and speechs to the industry seems to opine that structured financial products are a instruments fraught with risk. As such, I seriously doubt this text will have the legs to become an industry ready reference book. In the distribution of ratings on this book-- love it (touting) or dislike-- I rate this a 1 star text book; spend your money elsewhere.
Rating: 
Summary: A reality based view of structured financial products
Review: A must read for anyone who plays in the CDO market. Comprehensive and thorough -- from problems to benefits.
Rating: 
Summary: Topical technical book with short half-life
Review: Although this book is relevant and colorful given the financial scandals of the past few years, I would rate it an overall 3-star, average reference book. Editorial reviews are a bit more effusive than I believe the book deserves. It is good at describing the financial instruments, cautionary, if not outright negative, about the use of these risk management tools and colorful, if you are new to the business or have had your head in the sand for the past few years. As a technical reference book in a fast moving, creative marketplace, I think this book will have a short useful half-life for real practitioners.
Rating: 
Summary: Where was the editor?
Review: As a novice to securitizations, I can't speak about the merits of this book in comparison to its peers. However, I will say that it is neither a reference book nor a novel. The overall structure and organization of the book was horrendous with stories leading nowhere and technical examples blurted out onto the page without thought to a fundamental theme or why they were offered. An example is not a good teaching lesson if it doesn't relate to a fundamental point.
I don't blame the author because she is obviously skilled and well informed. I do blame the editor for not reviewing the book more carefully. Wiley shame on you!
Rating:
Summary: Vioce of reason
Review: Based on the numerous 5 star reviews that have been posted for this book, I was quite disappointed with what in reality is, at best, a 2 star effort. After having read the book in some detail-this is a text book, not some sci-fi, airplane read-and re-read the book reviews on this site, it is clear that the author has continued to write--- her own reviews. Tavakoli is gaming the system as she purportedly games financial instruments. A lesson of the book is learn the rules of the game and execute strategies accordingly, whether ethical or not. Clearly some of the paranoia expressed by the author for the misuse of these instruments is well founded. The balance of the book seems to be tilted toward raising anxiety and managing the inherent risk of these instruments vs. an affirmation of synthetics as true, risk management tools in the hands of ethical practitioners, not money grubbing IBs. The book provides a good tour of the synthetics market, but is not a 5 star effort. Amazon readers and reviewers, we are being gamed.
Rating:
Summary: Excellent
Review: Clear overview of the structured finance landscape. The detail in structural problems and solutions especially for the complicated and fast-growing synthetic structured finance products is excellent.
Rating:
Summary: Required Reading
Review: Collateralized Debt Obligations should be required reading for investors in the CDO market. Tavakoli gives a thorough overview of the market and explains the relative value traps and opportunities. Tavakoli explains several different kinds of possible structures in which cash flows can be diverted to either the detriment or the benefit of investors. The recommendations for the structural protections that investors should ask for repay the cost of the book - and the valuable time you take to read it - several thousand fold. Rating agencies have a difficult time rating tranches of several structures and as an investor, I wasn't aware of these discrepancies before. This book makes major strides in improving transparency in structured finance.
Rating:
Summary: Cash Flows Matter
Review: Equity cash flows are a major driver of the value of synthetic CDOs and are my chief interest. The cash flow analysis in this book was easy to reproduce to figure out how much in premium is paid out or diverted. The discussion of relative value of each structure to an equity investor was also very useful. The sections on European information are a bit tedious since I was only interested in the sections relevant to deals backed by predominately U.S. corporate credits, so I would have been satisfied with a shorter book.
Rating:
Summary: Straight Steering in Structured Finance
Review: Even the experts have trouble understanding the various complex structures in the collateralized debt obligation market. In this book, Tavakoli does for CDOs what she did for Credit Derivatives. She makes sense of the confusing terminology, shines a bright light on the key issues, and discusses how to avoid the potential for fraud.
She clarifies what the rating agencies miss. For instance, in a dispute between a German bank and a British bank that was recently settled in London, the British bank was alleged to have misled the buyer and then taken advantage of the buyer by substituting fallen angels into the CDO portfolio. Rating agencies don't capture this type of risk. Tavakoli explains how ratings won't save investors, but paying careful attention to the portfolio trading constraints in the deal documentation will. She recommends rewriting any "standard" document that doesn't adequately protect an investor's interest by adding trading rules and restrictions (if it is allowed at all), reserve accounts, and other structural protections.
She also debunks the term CDO "arbitrage." This "arbitrage" is not risk-free for the investment banks who arrange these deals, but using this term gives comfort to bank managers who may be unaware of the hidden volatility in their trading portfolios. Very inconvenient when one can't transfer the risk to an unwary investor's portfolio. Tavakoli points out that single tranche CDOs in which one is long the super senior and equity and short the mezzanine tranche can turn the trading book into a delta hedging parking lot. She also points out that CDOs squared put you at risk for having some of the least advantageous structures stuffed as collateral into a portfolio. If it requires diligence and rewriting the documents to get a fair deal in a CDO, why would you accept tranches from deals that you didn't have a chance to rework? Put in this context, buyers of those types of deals should demand a huge premium. These deals are beyond the scope of meaningful ratings, and nearly impossible to properly model in the secondary market.
The language is precise, and as she points out it can even be more important than understanding the numbers, since overwhelming risk can come from inadequate documentation. If you are an investor, don't venture into the world of collateralized debt obligations without reading this book. If you are trading these tranches, this book will give you details about these products you won't find anywhere else.
Rating:
Summary: Solid on CDOs
Review: Explains the complexities of CDOs, synthetics, and Special Purpose Entities.
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