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    What Makes Chimera Investment Corp. Different From Other REITs

    Thu, 07/14/2011 - 10:31 EDT - Seeking Alpha
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    • CIM
    • FMCC.OB
    • FNMA.OB
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    • Parsimony Investment Research

    Parsimony Investment Research submits:One REIT that seems to piquing the interest of many investors right now is Chimera Investment Corp. (CIM). Maybe it's the 15% yield or the $3 stock price (or a combination of both), but it is certainly on investors' radar screens. The stock continues to struggle even though many of its peers are in strong uptrends.

    (Click to enlarge)

    What makes Chimera Different?


    The main difference between CIM and many of its REIT peers is primarily portfolio composition. Over 50% of CIM's portfolio is invested in non-agency MBS, whereas most REITs focus primarily on lower-risk agency paper. While both agency and non-agency MBS have significant interest rate risk, non-agency securities also have credit risk [i.e., they are not guaranteed by government sponsored entities such as Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB)]. Without a government guarantee, the value of non-agency MBS depends largely on the quality of the underlying loansComplete Story »

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    • American Capital Agency Corp., Free of Fannie and Freddie, Looks Solid

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    • Chimera Cuts Dividend Again: What Should Investors Do Now?

      By Parsimony Investment Research:As highlighted in previous articles, we have never really been a fan of Chimera Investment Corp. (CIM).

    • Which mREITs Offer The Best Risk-Adjusted Yield For Your Portfolio?

      By Parsimony Investment Research:Investors should look at several key metrics when comparing and analyzing mortgage REITs, including size (market cap), leverage profile, composition of investments (i.e., Agency vs. Non-Agency and Fixed vs. Floating Rates), and most importantly tenure and strength of the management team. All of these metrics can significantly affect the risk profile of a particular REIT.

    • Fed Buying Should Benefit Agency RMBSs, Increase Mortgage REIT Prepayments And Spur New Secondaries

      By Zvi Bar:Last week, Ben Bernanke announced that the Federal Reserve would increase its holdings by adding open-ended purchases of $40 billion in mortgage debt. While the statement does clearly indicate that the Federal Reserve has concluded that the U.S. economy is not doing well on its own, the move quickly resulted in increased equity valuations.

    • Fannie, Freddie And The Treasury: Examining The Dynamics Of The New Arrangement

      By Colin Lokey:On Friday, the U.S. Treasury announced plans to "accelerate the wind down" of Fannie Mae (FNMA.OB) and Freddie Mac (FMCC.OB).

    • Dynex Capital: A Lower Risk Mortgage REIT

      George Spritzer submits: Dynex Capital (DX) is a real estate investment trust (REIT), which invests in mortgage securities and loans on a leveraged basis. It invests in a diversified portfolio of:

    • A Breakdown of Fixed vs. Floating Paper for 7 Agency mREITs

      Zvi Bar submits:Some mortgages are agency-backed, which means that the mortgages were issued and/or guaranteed by a quasi-government agency such as Fannie Mae (FNMA.OB) or Freddie Mac (FMCC.OB).

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