Another question on Book Value. If the 20-30 year bonds rise....... then we can assume the book value
of NLY will rise also?
No, because their existing portfolio is at lower interest rates and therefore declines in value.
I meant to say if the price of the 20-30 year bonds rise...say from 107 to 120 in the next eight months.....
then the BV of NLY will rise????????
If the price of the bonds go up, then book value goes up. If interest rates go up, the book value goes down.