Posted To: MBS Commentary
The end of November was a supportive environment for longer-dated Treasuries like 10yr notes and 30yr bonds. The MBS that most directly affect rate sheets tend to track more with this so-called "long end" of the yield curve. As such, rates have been stable to slightly lower for the past few weeks. Now we must ask ourselves if that was purely a byproduct of 2 temporary factors . The first factor would be the "month-end" trading environment. Most fund managers use industry benchmark indices (like Barclay's Aggregate Bond Index, which also includes specific indices for MBS and Treasuries) to determine the right mix of bonds in their portfolio. In other words, if a fund purports to hold 40% Treasuries, they're not just holding any random Treasuries, but a specific mix that averages out to the index...(read more)Forward this article via email: Send a copy of this story to someone you know that may want to read it.
from Mortgage News Daily http://ift.tt/1Tr54YL
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