Study Guides (248,617)
Canada (121,638)
Administration (1,205)
ADM3351 (2)
All (2)

Final exam fixed income 2.docx

9 Pages

Course Code

This preview shows pages 1,2 and half of page 3. Sign up to view the full 9 pages of the document.
Final exam fixed incomeQuestion 1A 65 passthrough rate 30year mortgagepass throught security is already seasoned with a weighted average maturity WAM of 332 motnhs left The current outstanding balance of 200 000 000 ad the weighted average coupon WAC rate is 8 The interest rates are quoted as annual percentage rate APR based on monthly compounding assumption Assume that the prepayment rate is 150 PSAaCalculate the total cash flow of the security to the investors for the next 2 motnhs Fill out the table on the next page15 pointsbHome owners do not want to be locked in high mortgage rates Briefly explain why financial institution are unwilling to offer fixed rate mortgage for long term eg 30 years and how this problem has been solved by the federally sponsored agencies such as Fannie Mae and Freddie Mac5 points MonthOutstand CPRSMMMortg Interest to Schedualed Total Cash balancePaymentInvestorPrincipalPrincipalflow
More Less
Unlock Document

Only pages 1,2 and half of page 3 are available for preview. Some parts have been intentionally blurred.

Unlock Document
You're Reading a Preview

Unlock to view full version

Unlock Document

Log In


Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.