CMBS are ``cheap,'' Naruki Nakamura, portfolio manager at Fischer Francis in Tokyo, said in an interview. The bonds yield 2.7 percentage points more than U.S. Treasuries, compared with 80 basis points a year ago, according to Merrill Lynch & Co.'s CMBS Fixed Rate Index. The spread reached 4.64 points in March, the widest since 1998 when the index started.
``The subprime problem has started to settle down and we are now in a situation where the system will not break up,'' Nakamura, who helps manage the equivalent of $2.5 billion of bonds, said June 24. ``We are planning to go overweight on CMBS as we're confident the market will not unwind again.
Friday, June 27, 2008
Friday, June 27, 2008 Posted by Deal Junkie
Is the worst almost over? One bond manager thinks so. From Bloomberg: