The other end (left) of asymptotic approach is 150+%
The line ends on the right at -100%, the maximum losses a note can have. That line when crosses 0 on the left tells you at what discount the 31+ days Late notes are starting to become profitable. The line is actually lot of individual points that seem to form that line indicating differences between individual notes may not matter much beyond discount. The same trend you could see somewhat for 16+ days Late and IGP notes also.
Yep, if you were just buying one note with most discount from each loan with no consideration to magnitude of discount, you will probably lose money at portfolio basis. But the note Ask Price may matter (not addressed here). If you could buy notes at higher discount you can make decent returns. There was another thread where someone mentioned someone buying notes at 90% discount. The chart kind of confirms that if you buy 31+ days notes at 90+% discount, you are likely to break-even or make profit.
Anyway future posts will be reviewing post listing performance with different secondary market attributes of notes. One such attribute will be Markup/Discount.
Author