Mortgage-Back-Securities.docx

Mortgage-Back-Securities.docx - Mortgage-Back Securities...

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Mortgage-Back Securities [email protected] Mortgage-Back Securities: Name: Institution:
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Mortgage-Back Securities My argument is that “Mortgage-back securities (MBS) benefits outweigh the costs”. There is the set provision of secure income as well as opportunity that allows for capital appreciation with a linked fall in the rates. MBS are thus basically traded actively in a similar situation as the bonds and this implies that there are low liquidity risks. Similarities They both tend to be issued for the aspect of raising finances for several reasons that may include expansion of a business. They both receive interest payments. Differences The MBS may be secured though home as well as other set real estate loans while on the other hand the corporate bonds may be unsecured or secured through assets that are
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