ZuoTi.Pro
Question

Q6. A commercial bank has a very positive duration gap between assets and liabilities, and would like to invest in some mortgage-backed securities to hedge the interest rate risk. Please rank the following securities in terms of hedging benefit to the bank A. IO strip in a CMO B. PO strip in a CMO C. The most senior tranche (tranche A) in a CMO D. The residual tranche in a CMO E. The pass-through securities

business   finance   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

Date: -p 9) Here thue Baluk Lias positive durrattors an pue ke best to beat Ledglg 。Hae best to best Le baseal om tueo n valut olue to Rauk

0 0
Add a comment
Know the answer?
Add Answer to:
Q6. A commercial bank has a very positive duration gap between assets and liabilities, and would...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • First Duration Bank has the following assets and liabilities on its balance sheet. What is the...

    First Duration Bank has the following assets and liabilities on its balance sheet. What is the duration of the commercial loans? First Duration Bank has the following assets and liabilities on its balance sheet Rate Liabilities Par Amount $450 million 70 Par Amount 2-year commercial $400 million loans al fired rate at par 1-year Treasury bulls S100 million 10°. I ar CDs al feed raalpur Net Worth $50 million 7. What is the duration of the commercial loans? A 1.00...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT