EFC - Yield Curve Drove Massive Rally

• Investors are thrilled about the steeper yield curve.
• A steeper yield curve is generally positive for mortgage REITs, and the impact to fundamentals is smaller than many investors may think.
• When the yield curve was flat and mortgage REITs traded at huge discounts to book, many investors said we were wrong to buy.
• Now that those positions are sporting huge capital gains, investors are excited about the steep yield curve. They missed the opportunity.
• The goal is to buy mortgage REITs at large discounts to book value. Where was the love three months ago?

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