Question: How do optional call provisions in a securitization differ from
How do optional call provisions in a securitization differ from that of a call provision in a standard corporate bond?
Answer to relevant QuestionsWhat factors do the rating agencies consider in analyzing the structural risk in a securitization? The below questions relate to rate reduction bonds. Answer each one. (a) What asset is the collateral? (b) What is a true up provision in a securitization creating rate reduction bonds? Explain the difference in the treatment of principal received for a self-liquidating trust and a revolving trust. Some hedge funds refer to their strategies as “riskarbitrage strategies.” What does that mean? What costs are incurred by an investor when purchasing a mutual fund?
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