The tranches in a collateralized mortgage obligation that are most likely to provide protection for investors against

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The tranches in a collateralized mortgage obligation that are most likely to provide protection for investors against both extension and contraction risk are:

A. Planned amortization class (PAC) tranches.

B. Support tranches.

C. Sequential-pay tranches.

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Fixed Income Analysis

ISBN: 9781119627289

4th Edition

Authors: Barbara S. Petitt

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Question Posted: Nov 04, 2023 11:00 PM

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The tranches in a collateralized mortgage obligation that are most likely to provide protection for investors against

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The correct answer is B Support tranches Support tranches are designed to absorb losses fro...View the full answer

Fixed Income Analysis

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