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TeachMeFinance.com - explain Collateral trust bond historic definition... Collateral trust bond -- A bond which is secured by collateral held in trust. A railroad requiring money may issue collateral trust bonds and place in trust as security for them stocks by the ownership of which it controls other railroads. About the author Mark McCracken Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English". Copyright © 2007 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer.