A pass-through security distributes the cash flows from the underlying mortgage pool to investors pro rata (in proportion to their ownership interests), after fees.
The cash flows are not restructured into different tranches, which would be a feature of a CMO.
The mortgages do not have to be fixed-rate or conforming for the concept of a pass-through to apply.
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Q-47.3 What is the essential (defining) feature of a pass-through?
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Last updated: April 18, 2026 at 11:32
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A
Cash flows distributed pro rata
71.4%
B
Cash flows are structured
28.6%
C
Loans are fixed-rate
D
Loans are conforming
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Q-47.3 What is the essential (defining) feature of a pass-through? | Financial Risk Manager Part 1 Quiz - LeetQuiz
