Question: Mark all the true statements about CMOs: 1. In a sequential pay CMO, the tranche that gets paid last assumes the least default risk 2.

Mark all the true statements about CMOs:

1. In a sequential pay CMO, the tranche that gets paid last assumes the least default risk

2. In a sequential pay CMO with just an A and B tranches, all tranches get principal payments in the first month

3. CMO can be agency or non-agency MBS

4. CMO can have several classes (tranches) of securities backed by the same pool of mortgages

5. In a sequential pay CMO, the tranche that gets paid off first is considered the safest

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