Welcome to The S-Curve
Now you will be able to receive the latest announcements, product updates, and our insights on the mortgage market in real time.
The name of the blog, the S-Curve, is a reflection of our logo and the central feature of our prepayment model. S-curves are seen in nature in many phenomenon, from population growth to prepayment and default models. Our first S-curve, in the early 1990s, used the arctangent function, then piece-wise linear functions, and evolved over time to be more complex and vary by FICO, loan size and LTV. This evolution encapsulates both the timeless nature of fundamental relationships and constant innovation to describe them better over time.
We hope you find the information useful and we look forward to your feedback.
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Policy Perspectives - Housing Market Dynamics and Mortgage RiskThoughtsOur latest Policy Perspective written by Richard Cooperstein offers an analysis of the U.S. housing and mortgage finance markets, focusing on key trends and forward-looking risks. While housing markets are not fully efficient, they do respond to economic imbalances which create opportunities and vulnerabilities. This article explores how demographic shifts, credit access, interest rates, and climate risks shape both housing demand and supply.
Key findings include:
- Weak demand fundamentals, especially among new homeowners
- Easing supply shortages and slowing price growth
- Elevated risk of broader housing price declines amid rising recession concerns
- Notable exposure of higher-coupon mortgages and servicing rights to interest rate and credit risks
Cooperstein also assess the resilience of mortgage-related assets under current and projected conditions.
Click here to read now!
The S-Curve Archives
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News
For several years, AD&Co has tracked the total rate of return (TRR) performance of the GSE CAS and STACR CRT in its U.S. Mortgage High-Yield Indices. The AD&Co Mid-Tier index constitutes a broad market measure of the TRR performance of GSE CRT. The related sub-indices segregate the CRT market into 4 index Tiers by attachment point, reflective of the credit exposure of the various classes of underlying CRT ranging from B to M1.
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EventsWe at Andrew Davidson & Co., Inc. (AD&Co) stand in solidarity with the Asian community and speak out against the xenophobic ignorance that has led to increased racist attacks against Asians. We protest against these hate crimes. This is a time to celebrate the richness that we have gained from the diversity of the Asian culture. We pledge to support the heritage that is part of what makes us American.
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Events
What does it mean to be mentally healthy? The answer is different for everyone. With all the extra anxiety that many of us have experienced since 2020, whether from uncertainty about COVID-19 or from other experiences that may be new to us, it’s important to acknowledge that it’s alright to not feel alright. Fortunately, there are numerous resources that are available locally, nationally, and in some cases through your workplace or benefits package. We might start by finding out what makes us feel better.
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Products
Today marks the publication of Chris Widman's Quantitative Perspective, a comprehensive article on the newest member of our LoanDynamics suite, the Auto LoanDynamics Model. Auto LDM will be integrated into vendor systems and AD&Co tools, allowing users to perform analysis on auto loan and ABS positions.
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EventsSince 1970, April 22nd has been the annual day to appreciate our planet and recognize the importance of protecting it. But more and more, we realize that everyday needs to be Earth Day, and that we need to take better care of the place that gives us life.
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Thoughts
To seek "causes" of poverty in this way is to enter an intellectual dead end because poverty has no causes. Only prosperity has causes. – Jane Jacobs, Activist and Author
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Events
CRTcast, a new podcast series under Freddie Mac’s Home Starts Here programming, focuses on credit risk transfer (CRT) and it’s three spokes: securities, (re)insurance and mortgage insurance. Freddie Mac leadership together with CRT industry experts cover current and relevant topics.
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News
We are proud to announce that Richard Cooperstein has accepted the position of co-chair of the Structured Finance Association’s (SFA) Regulatory Capital & Liquidity committee.
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NewsToday we acknowledge the Year of the Ox. Happy Lunar New Year! We stand in solidarity with the Asian community against all violence and racism. Here’s to a year of peace, health and prosperity.
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NewsThis February, AD&Co celebrates a central part of American History—Black History. The richness of the contributions of the Black community as a whole, and innumerable remarkable individuals, can not be overstated.