Novation Companies, Inc.

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Msg  137209 of 139347  at  5/6/2012 5:19:52 PM  by

MarionPolk2000


The ABX index was DESIGNED to fail

The ABX index was created solely to fail.  There would be absolutely no reason to be "long" the index, since the index supposedly "represented" the value of the underlying securities, but a person long the index DID NOT COLLECT the interest payments that would be earned by the underlying securities.  In fact it was a risk free trade to buy the underlying securitizations and short the index, since a person would then collect the interest payments, with no price risk.  That was done by the ABX underwriters, but it was also done by those trying to destroy securitizations, since the "price" of the ABX index became the measure of market value of the non-trading underlying securitizations.


 
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Msg # Subject Author Recs Date Posted
137211 Re: The ABX index was DESIGNED to fail batman10023 5/6/2012 9:41:16 PM
137214 Re: The ABX index was DESIGNED to fail batman10023 1 5/6/2012 11:03:31 PM


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