Skip to main content
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
Dikjones writes:

<<I just read TMFPixy's Bond Ladder note and wish to know if
collateralized mortgage options CMO amount to the same thing. If not,
which is best?>>


I'm not sure there is a "best," only what's right for you based on your comfort level. CMO's in my mind are more like (and somewhat worse than) a bond fund as opposed to an individual security. Part of the payments they throw off are principal and part interest. And the interest definitely can vary depending on any prepayment of principal by the debtor. I believe CMOs are tougher to ladder because maturities are harder to predict.

Regards..Pixy
Print the post  

Announcements

What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.