The Annaly Agency platform invests in agency Mortgage-Backed Securities (MBS) collateralized by residential mortgages which are guaranteed by Fannie Mae, Freddie Mac or Ginnie Mae. Representing approximately eighty percent of Annaly’s dedicated equity as of December 31, 2016, these investments allow Annaly to take advantage of the high liquidity of the government agency MBS market and relative yields generating attractive risk-adjusted returns. We hedge the interest rate risk in these securities with an array of products including interest rate swaps, futures and mortgage servicing rights. As the second most liquid fixed income market in the world, the agency MBS market offers a wide breadth of investment types and has access to robust financing markets due to its liquidity and government sponsorship.
Please click here to access Annaly’s Agency fact sheet.