PLANO, Texas – Southwest Corporate's new white paper, entitled "Dynamic Vector Analytics for Mortgage-Backed Securities," gives credit unions another tool for gauging the potential returns on these investments.

Authored by Southwest Corporate Investment Services' Senior Advisor Casey Peterson, the offering outlines the benefits of using vector analysis, an investment valuation method that incorporates the use of variable prepayment speed estimates instead of the constant prepayment speed estimates used in the traditional analysis of mortgage-backed securities through Bloomberg's Yield Table.

"While using constant prepayment speed estimates has merit in determining acquisition price of a security, it may not fully recognize the potential value of an investment over its entire holding period," Peterson said. "Dynamic vectors allow investors to incorporate multiple views on prepayment analytics and use them in pursuit of greater returns."