A bond that gives its holder a claim against financial asset (i.e., securities) rather than against real or physical assets. In other words, it is secured by a lien on a company’s holdings of other companies’ stocks and bonds, or an issuer’s subsidiaries (a holding company owning securities of subsidiaries). The issuer is required to deliver to the trustee the collateralized securities. The value of pledged securities will be regularly revaluated (marked to market) to reflect their market value. In case of value decreases, the issuer will have to post additional collateral in the form of cash or more securities.