*EXCLUSIVE* Brookstreet Securities Under Liquidation
Steve just called me from Value Rich In NYC. Must credit MN1.com for this story.
Brookstreet Securities Uunder Liquidation
Steve Kanaval: Executive Editor
CMO’s coming back to bite Stanley Brooks at Brookstreet Securities. The buzz today at the conference we are attending today revolves around a hedge fund liquidation in progress. CMO’s. A collateralized mortgage obligation (CMO) is a financial debt vehicle that was first created in June 1983 by investment banks Salomon Brothers and First Boston. Legally, a CMO is a special purpose entity that is wholly separate from the institution(s) that create it. The entity is the legal owner of a set of mortgages, called a pool. Investors in a CMO buy bonds issued by the entity, and receive payments according to a defined set of rules. The mortgages themselves are called the collateral, and the bonds are called tranches (also called classes), and the set of rules that dictates how money received from the collateral will be distributed is called the structure. The legal entity, collateral, and structure are collectively referred to as the deal.
A well informed source is quoted as saying a large prime broker was liquidating portions of the fund and the fund was hemorrhaging money early this week. Calls to the company went unreturned.
Brookstreet Securities Uunder Liquidation
Steve Kanaval: Executive Editor
CMO’s coming back to bite Stanley Brooks at Brookstreet Securities. The buzz today at the conference we are attending today revolves around a hedge fund liquidation in progress. CMO’s. A collateralized mortgage obligation (CMO) is a financial debt vehicle that was first created in June 1983 by investment banks Salomon Brothers and First Boston. Legally, a CMO is a special purpose entity that is wholly separate from the institution(s) that create it. The entity is the legal owner of a set of mortgages, called a pool. Investors in a CMO buy bonds issued by the entity, and receive payments according to a defined set of rules. The mortgages themselves are called the collateral, and the bonds are called tranches (also called classes), and the set of rules that dictates how money received from the collateral will be distributed is called the structure. The legal entity, collateral, and structure are collectively referred to as the deal.
A well informed source is quoted as saying a large prime broker was liquidating portions of the fund and the fund was hemorrhaging money early this week. Calls to the company went unreturned.
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