CMO Market Update

July 23, 2018

Last we saw the usual interest in 4.5 coupons off of 4.5 collateral. Investors also considered relatively short GNMA CMOs backed by Jumbo collateral.  In previous commentaries, we mentioned increased interest in VADM (Very Accurately Defined Maturity) CMOs, and last week we saw increased activity in them. Certain investors, specifically those sensitive to cashflow extension if mortgage prepays slow down, are usually the most interested in that type of structure.

Next Monday, we will summarize trade activity for the month of July.





Kevin A. Smith, CFA

Manager, Strategic Analytics

Vining-Sparks IBG LP

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