Commissions on CMO'S

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Jun 25, 2007 5:58 pm

How much commission are you charging on CMO'S? I am looking to update my rates and would like to find out what others are charging.

Jun 25, 2007 9:46 pm

3 points if I can get them.

Jun 26, 2007 11:21 am

Depending on the EAL anywhere from 1/4 of a point to 2 points. I've never heard of anyone taking 3 points on anything, most firms don't even allow it

Jun 26, 2007 11:46 am

You can get 3 points, enter it into the order entry system.  Works for CMO's and long term corporates.

Jun 26, 2007 12:37 pm

When I was at Jones, that was usually the one thing you could get 3 points on.  We were taught to sell them because they provided a monthly income.  No way to keep up with inflation, but a monthly income no less.

Jun 26, 2007 12:44 pm

These would occasionally go up to 3.75 at EDJ.  Now I can only get 1 max on any bond, and that has to be over 10 ytm.  Even at 3 pts, I feel like if I am servicing this account for the next 15 years, I'm getting paid less than the equivalent of an A share sold at NAV.


In other words, I rarely sell individual fixed income securities anymore.

Jun 26, 2007 12:46 pm
EDJ4now:

Now I can only get 1 max on any bond, and that has to be over 10 ytm. 



Let's make that 10 YEARS to maturity, not 10 (%) YIELD to maturity.  If I could get bonds yielding that high, I would probably have to start selling them again.