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The selling continues in the mortgage REIT space (MORT -3.4%), with one of today's biggest...

The selling continues in the mortgage REIT space (MORT -3.4%), with one of today's biggest losers Chimera Investment (CIM -3.8%) a curious one as its exposure is credit risk not rate risk. Other tumblers: Armour (ARR -6.4%), New York Mortgage (NYMT -6.5%), Javelin (JMI -6.1%), MFA Financial (MFA -3.4%). There's little bid for American Capital - (AGNC -4.1%), (MTGE -3.3%) - with one trader noting Gary Kain's focus on owning pre-pay protected paper is another bet not paying off as rates rise.
Comments (27)
  • june1234
    , contributor
    Comments (2517) | Send Message
     
    I thought we were in a housing recovery. That's what they keep saying
    29 May 2013, 10:22 AM Reply Like
  • tomlos
    , contributor
    Comments (1100) | Send Message
     
    Summer of recovery..... again.
    29 May 2013, 10:30 AM Reply Like
  • casca123
    , contributor
    Comments (227) | Send Message
     
    Well its a recovery for the banks who unloaded all those bad mortgages on the government and its a recovery for the new REITs that are buying good property for 0.30 cents on the dollar and as for John Q Homeowner ... well 2 out of 3 is better than 50% so its a recovery.
    29 May 2013, 10:34 AM Reply Like
  • cforget
    , contributor
    Comments (18) | Send Message
     
    Independent of any housing recovery, really a function of spreads between what these companies can lend at and ultimately lend out at. That's why these REIT's are taking a bit of a hit due to speculation that borrowing rates are going to be rising soon. I personally think it's an overreaction which translates into a buying opportunity to average down & pick up additional dividend income. NYMT is an interesting play in that my understanding is that they hold a fair amount of arm prdct which means if/when rates increase, so does their overall yield.
    29 May 2013, 10:32 AM Reply Like
  • tstreet
    , contributor
    Comments (567) | Send Message
     
    "a bit of a hit" Understatement of the year. More like mreitageddon.
    29 May 2013, 10:42 AM Reply Like
  • RoberHD05
    , contributor
    Comments (58) | Send Message
     
    Companies like ARR, AGNC and MTGE are basically good companies. The real problem in 'speculation' is not in those who no longer believe these companies are good and want to sell them, the problem is in people that think there might be a problem and sell thousands of shares they don't even own. I think 'short selling' is a serious problem. If you own the stock and don't want it anymore, by all means sell it. But if you don't even own the stock why should you be able to sell it hoping it will go down even further?

     

    Yes, there are a lot of bargains out there right now, but some of older folk who are already invested don't have any money left to buy these bargains, and I'm sure not going to borrow money to speculate on a down market. I lost a half million dollars when the tech bubble burst, I'm not going to do it again.
    29 May 2013, 12:38 PM Reply Like
  • kingdad
    , contributor
    Comments (852) | Send Message
     
    This is what you get when the Gov't manipulators get to play in the market. When the SEC fails to regulate and allows the short sellers a Carte Blanche free-pass in the system. I wonder how many Politicians are making Money today?
    29 May 2013, 10:40 AM Reply Like
  • joe kelly
    , contributor
    Comments (1727) | Send Message
     
    They get a great pension. They couldn't care less.
    29 May 2013, 11:29 AM Reply Like
  • hummerh25
    , contributor
    Comments (97) | Send Message
     
    As the 10 year bond goes up Reits will head south. ARR might hit $4.
    29 May 2013, 10:42 AM Reply Like
  • brokerbob
    , contributor
    Comments (17) | Send Message
     
    Big Benny B will raise interest rates because Housing is in a "Recovery" due to LOW Interest Rates which will, once again, kill the Housing Market, which will cause Big Benny B to Lower Interest Rates, which will recover the REIT's.

     

    The people who bought homes at the Higher Interest Rates will, once again, walk away from the home they purchased which will keep all the Dead Beats in the Mortgage Resolution business working, and on and on it goes, where it stops, no one knows.
    29 May 2013, 10:51 AM Reply Like
  • speculative
    , contributor
    Comments (622) | Send Message
     
    The REIT sector is currently being beat up on top of the fact that all markets are down with the Dow losing 164 points as of this comment. With the entire market sentiment on top of the sector taking a licking will produce these results. The market always comes back as history has shown and while the sector may not come back right away along with the market, it eventually will. That said, accumulate while the going is good. I have added two orders today each of ARR and NYMT. At the going rate, ARR is 17.3% dividend and NYMT is at 16.95%.

     

    It seems that the old adage of "Sell In May and Go Away" is more like "Sell In Late May and Go Away" but I have a strong feeling that the market is going to return for a good and strong MAY and the REIT sector will return some of its losses but not as strong as the entire market in the immediate time frame.

     

    Days like this will test the strengths of many retail investors stomachs and their sleep patterns as this performance can take these side effects. Sleep better and get in while the super sales are on market wide especially REIT's.
    29 May 2013, 11:09 AM Reply Like
  • Javimanic
    , contributor
    Comments (232) | Send Message
     
    I'm with YOU! as long as the divs keep rolling the compound interest long term(2+ years out) is great. Although I admit to some gastrointestinal infortitude this AM, yesterday AM- and come to think of it-2 days ago as well. I am mostly LONG on JMI, ,NYMT, and I am liking little ORC as well.
    29 May 2013, 01:53 PM Reply Like
  • m@ximus
    , contributor
    Comments (37) | Send Message
     
    total overreaction for $AGNC sellers (Ben keep it quiet pls in the coming meetings). IMHO no interest hike until 2014 assuming a solid job market improvement and QE will remain in efect in the medium term. entry opps for fresh dividends are everywhere in Reits.
    29 May 2013, 11:41 AM Reply Like
  • paul611
    , contributor
    Comment (1) | Send Message
     
    Selling is way overdone
    29 May 2013, 12:25 PM Reply Like
  • speculative
    , contributor
    Comments (622) | Send Message
     
    It may be returning some of the loss by the closing bell. Starting to see some signs of that already and those who didn't get in at the very bottom, they are still extremely attractive. AGNC; while I don't own it has already returned over $1.00 from its low for the day, NYMT returned 0.21 cents and ARR has returned 0.25 cents.
    29 May 2013, 12:31 PM Reply Like
  • speculative
    , contributor
    Comments (622) | Send Message
     
    Spoke too soon. I was hoping it stays under $5 to continue the "stock" pile. Still a bargain closer to $5 than $6 where it will be heading.

     

    Today's Open $5.17

     

    Previous Close $5.28

     

    Daily Range $4.82 - $5.23

     

    52-Week Range $4.82 - $7.98

     

    Dividend (Yield) $0.84 (15.9%)
    29 May 2013, 02:05 PM Reply Like
  • User 292804
    , contributor
    Comments (12) | Send Message
     
    Pay no attention. It's just me taking profits.
    29 May 2013, 12:39 PM Reply Like
  • ALTC
    , contributor
    Comments (29) | Send Message
     
    Long term bottom trend line for AGNC is 20.06....today's low of 20.01 was where it held support and bounced to 26.32. Same for MTGE....long term bottom trend line is 19.98 which it held (low was 20.09) and bounced to 21.20. Technical analysis does work......looks like the traders see the same thing and moved the stocks. Could have been a lot of short covering as these mREITS held at support levels.
    29 May 2013, 01:02 PM Reply Like
  • YONSU
    , contributor
    Comments (167) | Send Message
     
    the number on the low was 25.01
    29 May 2013, 01:34 PM Reply Like
  • vic@mixednutsinc.com
    , contributor
    Comments (21) | Send Message
     
    when the the 50 day and the 200 day mov. avg. crossed, that should have been our signal to run.. for now, I'm staying away.
    29 May 2013, 01:04 PM Reply Like
  • deercreekvols
    , contributor
    Comments (5163) | Send Message
     
    Until these "wonderful" bonds pay more than 2-3%, then I will stick with the 5-10% REITs are paying.
    29 May 2013, 01:25 PM Reply Like
  • Rustbelt Bill
    , contributor
    Comments (3) | Send Message
     
    Hopefully, the Shorts will take it where they earn it. As I understand it, the REIT's are all based upon the spread. Certainly, there will be adjustments in earnings as and when there are adjustments in interest rates- sometimes clumsy. If you think for a moment that the creators/operators didn't think these times would eventually be upon us, you are assuming that they only built these empires to operate in these bad times and that good/normal times would never return. Go ahead and sell now...

     

    Rustbelt Bill
    Detroit
    29 May 2013, 01:54 PM Reply Like
  • VenkatSankar
    , contributor
    Comments (23) | Send Message
     
    Thanks sellers. Sold bunch of ARR 5.0 put options and I have collected my fat dividend upfront.
    29 May 2013, 03:09 PM Reply Like
  • ALTC
    , contributor
    Comments (29) | Send Message
     
    CORRECTION....Low for AGNC today was 25.01 (typo error).YONSU was correct. Both AGNC and MTGE are both + so far today.......guess the "BIG BOYS" washed out the "casual" investors. We need to take advantage of a "BARGAIN" when we see it!!! Ex-dividend is a couple of weeks away.....watch for a move prior to this date.
    29 May 2013, 03:39 PM Reply Like
  • ALTC
    , contributor
    Comments (29) | Send Message
     
    AGNC.....heavy volume on the down side yesterday.....heavy volume down to the long term bottom then reversal. What do you technical guru's make of this???
    29 May 2013, 03:43 PM Reply Like
  • JimRay
    , contributor
    Comments (12) | Send Message
     
    Sure, the price is down; but, you don't lose anything until you sell. Just keep holding and draw the dividends.
    29 May 2013, 04:29 PM Reply Like
  • est1212
    , contributor
    Comments (24) | Send Message
     
    Be realistic. The golden time of AGNC is over (it was a good stock in the last several months ago), yes it is over. Things are changing.
    The interest rate will rise, the company incurred a lost in the recent quarter. I am not sure that they (AGNC) will keep a dividend of $1.25 for shareholders in the upcoming quater.
    It may be hard to sell the shares now for some investors if they are underwater, but sometime they need to learn to cut the lost to preserve their capital since the "game" will continue...and there is unfortunately no mercy at the down time.
    29 May 2013, 05:10 PM Reply Like
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