John Doe is considering adding a CMO to his portfolio. Tranche A has an outstanding balance of $100.000 million and pays $1.0 million in principal in month 10. Research indicates the PSA is 100 and the pass-through rate for tranche A is 7.00%. If all of the principal is paid to tranche A and the outstanding balance on the CMO is $300 million what is the cash flow to tranche A in months 10 and 11?

Answer rating: 100% (QA)

To calculate the cash flow to tranche A in months 10 and 11 we need to consider the information prov... View the full answer