reik, the problem is these guys and all the rest have proven they don't have a viable business model. If they hedge away interest rate risk they can't make any money, so they are essentially a bond/mbs trading vehicle - unless they diversity and then who knows what they become, or they run off into MSR's, etc. etc. and still can't make much money.
This good quarter was the result of good positioning but it's all a bunch of guesses by management. My original interest in the sector was spawned by the thought they could make 15%ROE and distribute it tax effectively to shareholders, but I don't think that's the case.
Total nonsense. They earn $840 million in the quarter and they have no viable business model? Try another strategy to talk it down. Slow summers allow hedge fund to run amok and claim up is down, black is white and night is day. 3 million shorts trying to get out and they attack to shake out the numb nuts but will eventually get burned.
I think they can make some sort of money tightly hedged up - alpha in there
and last quarter they did just fine and mbs didn't exactly run wild.
but I would at least say - I would hardly rush to buy hts, amtg or others today and not agnc.
that's whats wrong with tthis market is my point
hey I want utilities - so ill buy aep and cms which beat, but someone else says buy dte who missed badly
why? because nothing seems real.
how? there aren't enough traders on the screen to move it when it should move and so things are controlled and scammed - old firm I used to trade through had 200 to 300 traders, now just 15 to 20 and maybe 10 of them make real money.
as such not enough guys around the world to blast the offer and control the bids - and so the fake screen can continue
when retail traders buyers, 2 things happen - one that retail firm says you are stupid and takes the other side or 2 they parse it off and it seldom hits the screen, instead it gets shaved and traded on the inside. and so one guy can move the screen down and get massively long on dark pool.
example hts - they hit down to 19.25 - really why? after the beat - but now its good at 19.75 to 19.80? why? cause its stupid up and down stupid down and then hold there and print print print.
Unfortunately, I agree. I'm mired in a number of mREITs and simply can't afford to bail out at this point. ORC is doing a tremendous job, and I just don't get what ORC is doing differently than the other mREITs.