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LSDefine
Simple English definitions for legal terms
SMBS
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A quick definition of SMBS:
A security is something that you give or pledge to guarantee that you will pay back money that you borrowed. It can also be an instrument that shows you own part of a company or have a creditor relationship with a company or government. Securities don't have value on their own, but represent rights in something else. They can include things like stocks, bonds, or certificates of deposit.
A more thorough explanation:
SMBS stands for stripped mortgage-backed security. It is a type of security that is backed by mortgages. A security is something that shows ownership or a creditor relationship with a company or government.
For example, if you buy a stock, you own a small part of the company. If you buy a bond, you are lending money to the company or government that issued it. SMBS is a type of security that is backed by mortgages, which means that the value of the security depends on the value of the mortgages.
SMBS is a complex financial instrument that is not easy to understand. It is typically used by professional investors and not recommended for individual investors.