Synthetic CDOs, those funny-sounding transactions that ride the roller coaster credit derivatives market, have found an increasing number of friends in the U.S. While the volume of synthetic transactions has risen globally, the real story lies closer to home, as U.S. investors turned toward these transactions in large number this year.

Though it's difficult to get an exact breakdown, as different parties count differently, JPMorgan Securities estimates balance sheet CDOs - the dominant structure for synthetic CDOs in recent years - captured 37% of global funded issuance by mid-July. This compares to 27% reached during the same time in 2002.

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