Do I understand this correctly? If the company is paying .31 for 27 days, it would correlate to approx .93 for 90 days. If that is correct, then that would equal $3.72 dividend for the year. That would be a yield of approx 20%
A fixed rate portfolio is cheaper to hedge than a variable rate portfolio.
I love the yield spreads at 3+% and the leverage being employed. I think this one got missed in all the carnage because no one knows what the annual divvy will be until 3 months from now. Reminds me of when BEE issued a preferred with a stub payment. It got sold down but it was clear the yield was stated rate. Went back up immediately when investors recognized their mistake.
Press release said money deployed for 27 days. That would mean nonbusiness days since you earn interest on nonbusiness days on any type of lending.
NLY's dividend yield after divvy increase yesterday is at 15+% so it is possible that AGNC's yield is higher because AGNC may be using higher leverage and took advantage of higher yield spreads than NLY may have at this time. But we will know more when the first cc takes place.