Recovery trades sought

Recovery trades sought

Category: CDO Secondary markets

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ABS CDO appetite surges ahead of expected supply

The New York Fed has initiated a competitive bid process in response to several reverse inquiries for the MAX CDO holdings in the Maiden Lane III portfolio (see also SCI 10 April). The move comes amid surging interest in the ABS CDO sector, with fast money searching for low- to mid-teen returns in first-pay bonds and potential recovery trades in US RMBS.

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