Thanks Bearish. I agree there is no standard models and that is why I asked since no clear answers to me. Also, I found your answers to be exact reason why it has no standard model since different users may prefer different methods. I am trying to make something that can be both used by PM and RM and the methodlogy needs to be consistent, which creates this problems for me. If I am going for default modelling, I may lose the whole OAS framework. If I keep the OAS framework, I will lose all those default embedded cash flow analysis. Without saying even for default model, we have a few different approaches which are based on very different models.I think the answer is the same as it was back then - it depends. Obviously, HY credit analysts will expend a lot of energy on trying to gauge the default probability and recovery potential, even if they don’t necessarily phrase it as such. Traders tend to focus a lot more on the OAS (however defined). Buy side PMs are left to try and balance the two: am I getting paid enough (after counting the cost of the call option I’m short) to account for the default risk? Or, in many cases, the risk of a major price drop due to a downgrade? Credible models will account for the negative convexity associated with spread moves, but both the spread vol (and the awkwardly self-referential notion of adjusting the spread for the effect of spread vol), the correlation with the relevant rates, the exact nature of the joint process that they undergo, and the call behavior of the issuer are legitimate objects of study. To the best of my knowledge, there is no standard model out there. And if there is, I’m pretty sure there is no standard way of parameterizing it. But I’d be interested in alternative perspectives on this.