In this video, MCT’s Andrew Rhodes, Senior Director, Head of Trading, discusses spec duration within MCTlive!, why it is important to mortgage lenders, and how spec duration helps lenders hedge their position with various spec stories.
Watch the video below to see what Mr. Rhodes says about Spec Duration.
Topics Include:
- What is a spec duration and spec story?
- Why is spec duration important to mortgage lenders?
- How does spec duration help lenders hedge their position with various spec stories?
“There are a lot of different calculations for duration, the calculation we use is effective duration, which accounts for some of the embedded options of the forward TBA contract that we trade. We are bringing that spec duration component forward for the lenders to see the spec duration we are using for their hedge and tailor that to be specific to their own spec story and duration.”
– Andrew Rhodes, Senior Director, Head of Trading at MCT
Want to learn more from MCT?
In this latest MCT whitepaper, MCT’s Managing Director, Head of Sales, Ben Itkin, explains the intricate world of mortgage pipeline hedging’s key topics of duration, convexity, and the interplay between various market dynamics.
Download Whitepaper
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