First-to-default baskets (FTDs) are old-time products that were popular in 2001 and 2002 with the growth of the credit default swaps market and before the rise of CDOs.
Investors use them as a tool to boost returns on the sale of protection in credit default swaps contracts, i.e. bets that companies are not likely to default over a set number of years.
http://seekingalpha.com/article/6843...efault-baskets
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