What does "print red" or "print black" mean

I have come across this quite often but don't wanna ask in the office. There are questions that are stupid although we all say there isn't.

What does "print red" or "print black" mean when issuing a securitization say CRE CLO or CMBS?

Also, I hear "red line" a lot as well when in discussion of term sheets or documents. My guess is, it's just a version/draft that has both sides comments and editions. Please correct me if I'm wrong.


Comments (3)

Most Helpful
Apr 16, 2019

I would suggest you find someone in your office you trust to ask these types of questions. There's nothing worse than feigning understanding of a concept, only to have it blow up in your face later when someone asks you to run a redline.

Printing red or black probably has to do with how any new issue security breaks on the trade. If it breaks above par (in the black), it implies that pricing could have been wide of the mark. If it breaks below par (in the red), it implies that pricing came in tight. They are talking about the market-implied pricing as compared to the contractual pricing of the security given how the security trades after issuance.

A redline or blackline or markup are all the same thing. It's when a law firm (or anyone with MS Word) runs a compare between 2 different versions of the same document to show what has changed via drafting marks.

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Apr 16, 2019

Hi Speedmerchant,
Thanks for the response.
Your comments just taught me something new although it wasn't something I would expected.

I should emphasize that I'm asking specifically to issuing floating rate bonds (so always trade at par, like CRE CLO). What "print red" and "print black" means for a secularization marketing (or pre-marketing) term sheet. I kinda know that "print black" is the final version. (as prior versions have typos or numbers/infos changed since then).

    • 1
May 11, 2019