medium · CFA Level I fixed-income
If the Weighted Average Maturity (WAM) of a mortgage pool is 280 months and its Weighted Average Coupon (WAC) is 5.5%, the pass-through rate received by the investor will most likely be:
- Greater than 5.5% due to prepayment penalties.
- Exactly 5.5%.
- Less than 5.5%.
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