Learning Outcome Statements

1. Benefits of Securitization for Economies and Financial Markets

a. explain benefits of securitization for economies and financial markets;

2. The Securitization Process

b. describe securitization, including the parties involved in the process and the roles they play;

c. describe typical structures of securitizations, including credit tranching and time tranching;

3. Residential Mortgage Loans

d. describe types and characteristics of residential mortgage loans that are typically securitized;

4. Mortgage Pass-Through Securities

e. describe types and characteristics of residential mortgage-backed securities, including mortgage pass-through securities and collateralized mortgage obligations, and explain the cash flows and risks for each type;

f. define prepayment risk and describe the prepayment risk of mortgage-backed securities;

5. Collateralized Mortgage Obligations

e. describe types and characteristics of residential mortgage-backed securities, including mortgage pass-through securities and collateralized mortgage obligations, and explain the cash flows and risks for each type;

f. define prepayment risk and describe the prepayment risk of mortgage-backed securities;

6. Commercial Mortgage-Backed Securities

g. describe the characteristics and risks of commercial mortgage-backed securities;

7. Non-Mortgage Asset-Backed Securities

h. describe types and characteristics of non-mortgage asset-backed securities, including the cash flows and risks of each type;

8. Collateralized Debt Obligations

i. describe collateralized debt obligations, including their cash flows and risks.