The program covers the basics of terminology and features of individual mortgage contracts all the way through to the structure and investment characteristics of exotic instruments such as PAC bond tranches and reverse mortgage securitization.
Along the way, the program will address aspects of the MBS market ranging from the creation of the basic building blocks (mortgage origination and types of mortgages), the process of turning them into investment instruments (asset securitization) and how in certain instances the cash distributions are structured to create a variety of securities from a single collateral pool (types of tranches of Collateralized Mortgage Obligations – CMOs).
The majority of the program will focus on the largest segment of the market, agency (FNMA, FHLMC and GNMA) residential mortgage backed securities, both pass-through securities and CMOs. However, the other market sectors (agency multi-family, non-agency CMOs and commercial mortgage-backed securities – CMBS) will be addressed in some detail.
What you will learn?
- Structural features and their impact on valuation and analysis of MBS
- Describe the structural features and cash flow characteristics of pass-through securities
- Recognize the impact of prepayment rates in the analysis and valuation of MBS
- Explain the basic features of agency and non-agency CMOs as well as important types of tranches (sequential pay, Planned AmortizationClass, accrual/z-bond, etc)
- Describe the basic elements of TBA (To Be Announced) trades and dollar rolls
- Mortgage-Backed Securities (MBS)- Part I
- Mortgage Backed Securities (MBS)- Professional Certificate Exam
- Mortgage Backed Securities (MBS)- Part II
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