My knowledge here comes from the film Big Short so take that with a grain of salt lol, but they explained it as a step beyond what you describe in that a synthe

My knowledge here comes from the film Big Short so take that with a grain of salt lol, but they explained it as a step beyond what you describe in that a synthetic CDO as more a bet or insurance on the underlying bundled debt. So like placing a bet of $1000 that the $100 debt owed to alice wont default. https://www.youtube.com/watch?v=EEXTqtH-Oo4 https://www.youtube.com/watch?v=EEXTqtH-Oo4 https://en.wikipedia.org/wiki/Synthetic_CDO https://en.wikipedia.org/wiki/Synthetic_CDO