SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: tom pope who wrote (15654)9/26/1998 5:30:00 PM
From: Wallace Rivers  Read Replies (1) of 120523
 
Absolutely, Tom...prepays will continue to be a problem. However, IMO, if Fed Funds are lowered, the short end of the curve will drop more than the long end (the long end may even go up - inflation jitters), thus yielding more normalized spreads, and a yield curve which is much more beneficial to CMO's business.
CMO also bought treasuries at about 5.6% - 5.75% when it exited the IO debacle. That position is a portion of the hedge, per my understanding, and is doing well with the long bond approximately 50 bp lower. They have also initiated a "streamline refinance" program, where those who prepay can choose to continue to do business with CMO at a different (lower) interest rate. This is a simplistic explanation. How much that will offset prepays would be a wild guess.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News