Fannie Mae-No Politics (FNMA)

[kthomp19]

Why would you switch when there are major catalysts only a few months away?

The idea is to unwind the trade in 2 months or so, even if it's at a loss.

There's always the risk that the FNMAS:FNMA ratio continues to rise, but the point of the trade is to bet against that and my plan is to only rotate 5% of my portfolio anyway.

I still think the endgame risk/reward here vastly favors the prefs, even with FNMAS:FNMA at 4.65:1.