More stable and somewhat higher rates brought banks back and revived the interest in various CMO structures. Additionally, even more so than before the rally, the duration offered by CMOs is unavailable in other mortgage products. Consequently, while banks focus on short CMOs, long structures enjoy the attention of duration-seeking accounts. The most dealable coupons are 30-year 5s and 15-year 4.5s. For duration-minded investors, recommends last-cash-flow PACs and sequentials backed by current-coupon new collateral. Among shorter trenches, favors deals backed by 15-year collateral for prepayment risk profiles.

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