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Noted with hope in the Hatteras earnings call is this morning's 13% plunge in mortgage refinance...

Noted with hope in the Hatteras earnings call is this morning's 13% plunge in mortgage refinance activity (though the Columbus Day holiday may be behind this). Along with narrowing margins, prepayments are a major concern for mortgage REITs, and the tumbling sector will take the good news where it can get it.
Comments (3)
  • Trongod2000
    , contributor
    Comments (93) | Send Message
     
    I think there is more bad sentiment than bad facts/news on this segment of the market.
    24 Oct 2012, 01:20 PM Reply Like
  • User 524962
    , contributor
    Comment (1) | Send Message
     
    yes , government portfolio's of mortgage reits will find prepaments an issue with profits, however, CIM purchased a ton of discounted mortgages and high risk paper. Seems to me that getting prepaments on that portion of their portfolio should be extremely benificial....especially if they purchased it at .10 cents on the dollar and the get 100 cents on the dollar with prepayments.....

     

    Any comment on this aspect of the mtg reit senerio?
    24 Oct 2012, 03:16 PM Reply Like
  • HORSESHOER
    , contributor
    Comments (24) | Send Message
     
    I dont recommend selling your mtg reits. They dont stop paying dividends. case in point NLY in 2004 cut their dividend to.09 cents and I sold. Had I held it I would hace collected a lot of dividends in 8 years instead of taking a loss. keep your reits and just sit back and collect your dividends and more dividends and bigger dividends when the cycle changes
    24 Oct 2012, 08:54 PM Reply Like
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