Fannie Mae-No Politics (FNMA)

[FOFreddie]

Fidelity may have to purchase $ 600 million of FNMA just for its S&P500 index fund which has approximately $240 bn in assets. Probably a lot more for all of its funds. Vanguard may be even more for its idex funds.

If FNMA has a market cap of approximately $125 bn it will have a S&P 500 weighting of more than 0.25%. $240 bn times 0.25% = $600 million. The question is when and what price.

Better early than late? Nomura estimated fully diluted divident of $0.50 may make it likely to be early and at least not too late.