How to Hedge MBS?
I understand that the answers depend on who you are (e.g. dealer, spread investor, absolute return investor, etc.).
But what do you hedge in general (e.g. duration, convexity, volatility, spread)? And what instruments do you use?
I understand that the answers depend on who you are (e.g. dealer, spread investor, absolute return investor, etc.).
But what do you hedge in general (e.g. duration, convexity, volatility, spread)? And what instruments do you use?
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