标题: passthrough vs. paythrough [打印本页] 作者: morebeans 时间: 2011-7-13 16:27 标题: passthrough vs. paythrough
What is the difference between passthrough vs. paythrough tranching with respect to ABS?作者: genuinecfa 时间: 2011-7-13 16:27
Not really sure what you're talking about with 'Paythrough', but my understanding was that there are two types of MBS'.
1) Passthrough: Where all the payments are passed through as they are to the investors. So every investor has the same prepayment risk. i.e there is no 'tranching'
2) Traching : Different Tranches have different risks...PAC's, Sequential, IO's, PO's etc..
Edited 1 time(s). Last edit at Friday, June 3, 2011 at 11:31AM by deepstack31.作者: scarecrow 时间: 2011-7-13 16:27
from my notes:
Passthrough vs Paythrough Structure
ABSs can have passthrough or paythrough structures.
Passthrough: cash flows generated by the underlying asset pool are paid, pro rata, to the investors
Paythrough: the CFs are distributed according to what tranche an investor went with. The same asset pool can allow securities with varying risks to be created from it.
so I understand this to mean that paythrough is just a passthrough that gets tranched up.作者: scarecrow 时间: 2011-7-13 16:27
i dunno, that's just what's there, so I trust it
Edited 1 time(s). Last edit at Friday, June 3, 2011 at 01:37PM by magicskyfairy.
