eoin

"so if the BM has the same credit & liquidity risk then you want the higher OAS
"

if the BM has came credit and liquidy risk, you should be fine with an OAS of 0, that would meen fairly priced ...

my problem with what they are doing is that they assume a positive OAS meens underpriced while they neglect the fact that even if the BM is the issuers own curve, if the security under examination has lower liquidity it may have a high required OAS and thus simply having a positive OAS is not enough