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Just what are the ECB's bond-buying options?

With just a day to go before the European Central Bank's (ECB) hotly anticipated policy meeting, there's a lot of talk about President Mario Draghi's options to help revive the moribund euro zone economy.

After the central bank has cut rates and unveiled ultra-cheap long-term loans, many believe Draghi is running out of options to tackle slowing price rises and stubbornly low bank lending. One of the most discussed – and controversial – stimulus measures is some form of bond-buying program.

Now – following comments by Draghi at Jackson Hole in late August - expectations of some sort of quantitative easing (QE) program have been heightened.

Read MoreEuro zone inflation hits 5-year low; ECB action eyed

But it's not quite as simple as that. There's two types of bond-buying available - but which is which and which is the most likely?

'Private QE' - asset-backed securities

Under the asset-backed securities plan, euro zone banks will sell the ECB their loans and other types of credit that have been packaged together as securities. The aim of such an approach would be to strengthen the euro zone's financial system and increase lending in the real economy, by boosting banks' balance sheets.

The type of assets that would be targeted by the central bank is unclear, although Draghi has previously expressed a preference for "simple and transparent" ABS, and those backed by smaller businesses. Last week, the ECB said it had hired BlackRock Solutions to help it prepare the program.

Read MoreEuropean bank officials weigh QE 'shock and awe'

However there are concerns about the impact of such a program, given the limited supply of securities, with Drgahi himself acknowledging that the market is "relatively small" earlier this year.

Outstanding euro-zone ABS amount to only 1 trillion euros ($1.3 trillion), or 10 percent of all loans to households and firms in the region, according to Capital Economics' James Howat.

Mario Draghi, President of the European Central Bank
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Mario Draghi, President of the European Central Bank

Follow the Fed with full-blown QE

Launching a QE program similar to that of the U.S Federal Reserve and the Bank of England, whereby the central bank will buy up sovereign debt from lenders, would be a controversial move. This is primarily because there are no common euro zone bonds and, technically, the ECB can't invest in an individual country at the expense of another.

Read MoreEuro zone yields turn negative on Draghi hopes

"We don't expect sovereign bond purchasing to be ruled out, but it faces political, legal and technical questions in a way that private QE does not," Deutsche Bank's Mark Wall and Giles Moec said in a note.

One option open to the ECB would be to purchase government bonds proportional to the size of each euro zone nation – but not everyone would be happy with this.

Germany, as the largest euro zone country, would likely be the recipient of the largest amount of ECB cash, which could anger some of the smaller, struggling nations. On the other hand, Germany has expressed concerns about the purchasing of government bonds from countries with comparably poor financial discipline.

Given these hurdles, most economists expect full-blown QE as a last resort. "Government bond purchases will remain in reserve for a more outright deflationary episode," Wall and Moec added.

- By CNBC's Katrina Bishop

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