PAR

CDS

Coverage

Available for both Public companies and liquid Private Companies

Available for Public companies only

Coverage Amount

$1,000,000 minimum and no maximum

Only in increments of $2,000,000

Tenor

Six months to five years

Typically, minimum of 1,3 and 5 years

Obligor Risk

Coverage on invoiced obligor

Obligor often different from reference obligation

Net Recovery

Certain: 100% less cost of coverage

Uncertain: varies based on price of reference obligation and recovery amount