Wall Street often refers to CMOs as "customized securities." Explain why
What will be an ideal response?
CMOs are "customized securities" in the sense that they can be tailor-made to satisfy the preferences of investors. For example, classes of bonds or tranches can be created which are customized or structured for individual and institutional investors to meet a particular prepayment risk that is desired.
You might also like to view...
A one-sample nonparametric goodness-of-fit test to determine whether the observations for a particular variable could reasonably have come from a particular distribution is the ________
A) Kolmogorov-Smirnov one-sample test B) runs test C) binomial test D) Mann-Whitney U test
Which of the following BEST explains how a firm reduces risk by operating internationally?
A) taking advantage of business-cycle differences among countries B) buying competitive risk insurance unavailable domestically C) preventing competitors from operating in the countries it has entered D) operating in less competitive environments than those at home