Imagine you have a basket of loans. You can cut it into slices, each with a different risk level, and then sell those slices to investors who want different mixes of safety and return. That’s the heart of structured credit — it changed the way markets think about credit risk. In this chapter, we’ll look at how collateralised debt obligations, first‑to‑default baskets, and standardised index tranches work, and why they matter.