In Comparison to the Mortgage Securities We Have Previously Discussed

question 9

Multiple Choice

In comparison to the mortgage securities we have previously discussed, the unique characteristic of CMOs is that:

• A) CMO issuers retain ownership of the underlying mortgage pool
• B) CMOs are issued in multiple security classes
• C) The CMO mortgage pool is not overcollateralized
• D) CMOs are a pay-through in which all amortization and prepayments flow through to investors

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Definitions:

Binet and Simon

Alfred Binet and Theodore Simon were French psychologists who, in the early 20th century, developed the first intelligence test to identify children needing special education.

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