Financial Data and Key Metrics Changes - Year-to-date shareholder returns were 20% as of last Friday's close, and 23% over the last year, with nearly 72% returns over the last three years when dividends are reinvested [6] - Total economic return for the quarter was 10.3% and 11.5% year-to-date, reflecting disciplined management of Agency RMBS [6] - The common equity market cap surpassed $1.8 billion, indicating broadening trust from individuals and institutions [7] - Estimated book value was $12.71 net of the dividend accrual as of Friday's close [31] Business Line Data and Key Metrics Changes - Net interest income continues to trend upward due to new investments with attractive yields, with over $130 million in gains on the portfolio in the third quarter [12][13] - The portfolio has grown over 50% larger since the beginning of the year and is 10% larger since the end of the second quarter [14] Market Data and Key Metrics Changes - Agency mortgages offered wide spreads to treasuries and interest rate swaps, with nominal spreads remaining wide [16] - The GSEs have the capacity to add up to $450 billion under current stock purchase agreements, which could increase demand for Agency MBS [44] Company Strategy and Development Direction - The company aims to build a resilient platform at the intersection of capital markets and housing finance, focusing on risk discipline and liquidity management [5] - The strategy includes a deliberate bias towards lower coupons, which are expected to outperform as mortgage rates decline [17] - The company is opening a new office in New York City to attract talent and strengthen market position [15] Management's Comments on Operating Environment and Future Outlook - The operating environment remains complex, with vulnerabilities due to persistent inflation and geopolitical factors [7] - The Federal Reserve is committed to bringing rates down to more neutral levels, but uncertainty in the rate path is significant [8] - The company is prepared for potential surprises in the private credit market, emphasizing a deliberate growth strategy [10] Other Important Information - The company has raised $254 million in new common equity capital in the third quarter, bringing year-to-date new capital growth to $776 million [13][17] - The company continues to focus on disciplined risk management and liquidity to weather future volatility [14] Q&A Session Summary Question: Where do you see incremental spreads and current ROEs? - ROEs in agency RMBS remain in the high teens net of hedging costs, with gross in the mid-twenties for a large percentage of the coupon stack [29] Question: Can we get an update on book value quarter to date? - Estimated book value is $12.71 net of the dividend accrual as of Friday's close [31] Question: Can you discuss the demand side outlook for agencies? - GSE holdings of Agency MBS could increase, with the capacity to add significant amounts under current agreements [44] Question: How are you thinking about swap spreads? - The federal deficit is a major factor, and while spreads could go more negative, there is a buffer at current levels [38] Question: What are the implications of lower volatility on your hedging strategy? - Lower volatility allows for the repurchase of options that were short in a levered mortgage position, stabilizing the portfolio's duration [48] Question: Do you see opportunities to pick up alpha within the coupon stack? - There are tremendous opportunities across the coupon stack, allowing for flexibility beyond the current coupon [60]