In OP’s first case the borrowed funds is amortizing plus in your own sample would be the money happens to be IO. The “amortization try minimal” thoughts is wrong, it will make an enormous difference on ROE.
In OP's first case the borrowed funds is amortizing plus in your own sample would be the money happens to be IO. The "amortization try minimal" thoughts is wrong, it will make an enormous difference on ROE. The OP received negative arb of the obligations YOC vs. price obligations (4.75percent vs 5.77percent). Inside your example discover favorable arb (YOC vs.…
