Why is it and how can it be that the more junior cmbs


Question: Why is it, and how can it be, that the more junior CMBS tranches command stated yields that are higher than the expected returns to the underlying property equity that backs the credit of these securities? Why are junior CMBS tranches more risky than whole first mortgages with the same LTV ratios?

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Finance Basics: Why is it and how can it be that the more junior cmbs
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