As nearly the entire liquid 30-year market trading over par - while the 5.0% coupon doesn't trade at all - the mortgage backed securities market is concentrated in a very narrow range.

"Everything in the 6.5% coupon and above is set to prepay at close to 60 CPR, so most of the action in the market is in the 5.5% coupon and 6.0% coupon," said Art Frank, head of mortgage research at Nomura Securities International, Inc.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.