Financial Data and Key Metrics Changes - For Q3 2025, the company reported net income of $0.53 per share, a significant improvement from a loss of $0.29 in Q2 2025 [5] - Book value increased to $7.33 as of September 30, 2025, compared to $7.21 on June 30, 2025 [5] - Total return for Q3 was 6.7%, a recovery from -4.7% in Q2 [5] - Average portfolio balance rose to $7.7 billion in Q3 from $6.9 billion in Q2 [5] - Liquidity improved to 57.1% at September 30, 2025, up from 54% at June 30, 2025 [5] Business Line Data and Key Metrics Changes - The average coupon of the portfolio increased from 5.45% to 5.53%, and the effective yield rose from 5.38% to 5.51% [30] - The net interest spread expanded from 2.43% to 2.59% [30] - The portfolio remains 100% agency RMBS, with a focus on call-protected specified pools [30] Market Data and Key Metrics Changes - The cash Treasury curve and SOFR swap curve showed a slight steepening, reflecting market expectations of Fed rate cuts due to labor market deterioration [7][8] - The long end of the Treasury curve performed well, with strong demand in the investment-grade corporate market despite tight credit spreads [10] Company Strategy and Development Direction - The company is focused on maintaining a conservative leverage posture while enhancing the carry and prepayment stability of its portfolio [30][39] - The strategy includes investing in high coupon specified pools to insulate against adverse payment behavior and stabilize income streams [30][43] - The company anticipates potential tailwinds from continued Fed rate cuts and the end of quantitative tightening, which could support the agency RMBS market [44] Management's Comments on Operating Environment and Future Outlook - Management noted a potential crossroads for the economy, with labor market weakness prompting Fed rate cuts, while also observing strong consumer resilience and government stimulus [46][47] - The company expects to adjust hedges to lock in lower funding costs and prepare for potential rate hikes following anticipated Fed cuts [48] Other Important Information - The company raised $152 million in equity capital during the quarter, which was fully deployed into high-quality specified pools [29][43] - The weighted average price of the portfolio increased to over $101, indicating a premium position [72] Q&A Session Summary Question: Any macro factors that might change overall risk positioning? - Management indicated that if the Fed continues to cut rates and the economy rebounds, they might consider increasing leverage [51][52] Question: View on payouts upside potential with refi momentum? - Management noted that payouts have increased sharply recently, but they do not expect to return to the high levels seen in 2020 or 2021 [54][55] Question: Scenarios for dollar roll specialness returning? - Management expressed skepticism about the return of dollar roll specialness, citing the Fed's focus on buying Treasuries and bills rather than mortgages [61][62] Question: Supply and availability for longer-dated repo? - Management mentioned that spreads for longer-dated repo are currently too wide, but they are opportunistically looking to lock in funding [63][64] Question: Percentage of portfolio covered with call protection? - Almost 100% of the portfolio has some form of call protection, which is expected to mitigate risks in a declining rate environment [72]

We've seen the ten year. Good morning. Seeing the technique push through, then through that 4% level, we're at 3.9%, 7% right now.Shutdowns can be good for treasuries. What are we expecting to see. What are you watching for next when it comes to Treasury markets.Yeah, absolutely. So what you've seen over the past few months is the rally in Treasuries has largely been because you've priced in more Fed easing. I think also it's very true that the US government bond market has returned as the safe haven of cho ...

Fixed income investors know that bond prices and yields move inverse of one another. That means when yields decline, prices rise. And that's perhaps the biggest reason the Fed moves are so widely monitored. The price/yield scenario holds true across the bond universe. That means Fed action is impactful for ETFs such as the Neuberger Berman Flexible Credit Income ETF (NBFC). The fund lives up to its "flexible†billing. That's because the actively managed fund features both investment-grade and high-yield co ...

The 10-year yield a little bit lower today. Second day of the federal government's partial shutdown. So, let's figure out what the bond market cares about.And head to Chicago. Rick Santelli kind of following the news and the movement in bonds. Rick.Yes, Brian. And it is indeed day two. Yesterday, we did have a data point because it wasn't related to the government in terms of its release ADP.And that's important. If you look at a two-day chart of twos and tens, you can see the ADP move. the last real data p ...

The 10-year yield a little bit lower today. Second day of the federal government's partial shutdown. So, let's figure out what the bond market cares about.And head to Chicago. Rick Santelli kind of following the news and the movement in bonds. Rick.Yes, Brian. And it is indeed day two. Yesterday, we did have a data point because it wasn't related to the government in terms of its release ADP.And that's important. If you look at a two-day chart of twos and tens, you can see the ADP move. the last real data p ...

Rick Santelli. Rick, kind of like the stock market, the bond market's probably used to it at this point, but at what point does it start to matter. >> You know, I can't even guess at what point it starts to matter, but as previous guests have been saying all morning, uh, pretty much we've seen this all before.It is a kabuki dance to some extent, but of course, if it lasts a a certain amount of time, and I'm not sure what that timeline is, the markets might pay some attention. But today they paid a whole lot ...

Fed comments on Monday were mixed. On the dovish side, New York Fed President John Williams said inflation risks have receded, while those for employment have moved up, making it sensible for the Fed to lower interest rates. Conversely, Cleveland Fed President Beth Hammack said inflation “is not really getting back down to the Fed’s objective of 2% until the end of 2027 or early 2028” and that “we really need to maintain a restrictive stance for policy.”The US Sep Dallas Fed manufacturing activity survey un ...

What do you make of all four indices, the three major ones in the Russell hitting highs at the exact same time on the day after the Fed rate cut when the day of the rate cut the indices actually closed lower with the exception of the Russell I should say. Historically over this cycle particularly we have seen some very mixed results on the actual day of trading followed by sort of a decisive result. It was a strange SEP and I think that a lot of what happened on Wednesday's trading was trying to decipher so ...

Market Overview - Wall Street experienced a modest decline, with the S&P 500 and Nasdaq slipping from record highs as investors assess trade and economic updates [1] - U.S.-China trade talks are reportedly becoming more productive, with Treasury Secretary expressing confidence in a potential deal [1] - August retail sales exceeded expectations, but did not alter predictions for a 25 basis point interest rate cut by the Federal Reserve [1] - Market expectations remain high for a total of 75 basis points of Fed easing by year-end, according to CME FedWatch tool [1] Company Updates - Amazon's price target was raised by Truist to $270 per share from $250, with credit card data indicating North American revenue tracking $1 billion above consensus estimates [1] - Analysts noted Amazon's conservative forecasting history, which may lead to a conservative outlook for the upcoming quarter [1] - Goldman Sachs received a price target increase from Wells Fargo, raised to $855 from $785, benefiting from strong capital markets activity and demand [1] - Microsoft announced a 10% increase in its quarterly dividend, aligning with its five-year average, and has over $55 billion remaining in its share repurchase authorization [1]

Market Overview - The current IPO market is showing healthy performance, with a more stable environment compared to 2021, indicating a positive outlook for the market [1][2] - The anticipation of Federal Reserve rate cuts is contributing to investor confidence, suggesting a favorable climate for IPOs [2][3] Federal Reserve Insights - The Federal Reserve is expected to cut rates by at least 25 basis points, with indications that this is a pivotal moment for monetary policy [3][4] - There is a belief that the Fed will remain data-driven in its approach, avoiding explicit signals about future rate cuts [5][7] - Inflation remains a concern, but it appears to be reasonably contained, allowing the Fed to focus on economic growth without rushing into aggressive rate cuts [5][10] Economic Indicators - Recent job adjustments, such as the 900,000 figure, are seen as a signal that the economy is approaching a point where rate cuts may be appropriate [4] - The flattening of the yield curve is viewed positively, as it suggests a healthier alignment of mortgage rates and overall economic stability [9][10] - The focus is shifting towards ensuring economic growth and avoiding a recession, with previous fears of an engineered recession not materializing [11]