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Principal only

• Abbreviated PO. A mortgage-backed security in which the holder receives only principal cash flows on the underlying mortgage pool. The principal-only portion of a stripped MBS. For PO securities, all of the principal distribution due from the underlying collateral pool is paid to the registered holder of the stripped MBS based on the current face value of the underlying collateral pool.

 
 Embedded terms in definition
 Cash flow
Cash
Collateral
Distribution
Face value
Mortgage
Pool
Principal
Securities
Security
Underlying
 
 Related Terms
 

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