Fannie Mae-No Politics (FNMA)

[JOoa0ky]

I do believe a rights offering will be available for legacy common shareholders. I also agree that it does not make sense to convert some of the lower yielding preferreds at liquidation value.

Some of the variable rates are based on 3 month libor or 12 months or w/e and the div rate for those are unbearably poor... Those who hold onto those will get shafted big time. The conversion rate for those will be very very poor.

Even if they make it to par and it yields less 1%... no one will buy them off of you unless you sell for a massive discount so that the yields will be greater. The conversion offer for those will be an ultra low ball.


Also please take note of callability of the prefs. All of them are callable with the exception of FNMAS and FMCKJ. FNMAS is callable every 5 years and is due this year at 12/31/2020 I believe or close to it. The freddie won't be due for another 2 years. Something to think about...