C-BASS surprised an already jaded market last week when the company issued a statement acknowledging that it had received a substantial number of margin calls, which would hinder the liquidity of its business.

The announcement was prompted by a revelation from parent companies MGIC Investment Corp. and Radian Group that they might need to write off the boutique shop completely. The negative news has market participants speculating that C-BASS might not be able to sustain its business.

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