Our Approach

“Selecting high quality assets, optimizing financing structures, and managing market risks are critical components of levered fixed income investing. Since inception, our dynamic portfolio strategies have been a major driver of AGNC’s outperformance across economic cycles and exogenous events.”

Christopher Kuehl, Executive Vice President & CIO

A Dynamic Agency MBS Investment Framework

Asset Selection

Asset selection expertise with decades of experience specializing in Agency MBS investments

Funding

Competitive funding advantages that are further enhanced by our captive broker-dealer

Risk Management

Dynamic risk management strategies that aim to protect the value of our portfolio

The AGNC Value Chain

Asset Selection

Our skilled team has decades of experience investing in Agency MBS, an expansive and highly liquid asset class with compelling fundamentals that protects investors from credit risk and facilitates American homeownership.

  • Attractive Fundamentals
    The Agencies – Fannie Mae, Freddie Mac, and Ginnie Mae – guarantee principal and interest payments for these assets, insulating investors from credit risk associated with homeowner defaults.
  • The AGNC Advantage
    We carefully select assets with favorable underlying loan characteristics, utilizing proven modeling techniques to analyze each asset’s risk profile and optimize returns over the life of the investment.

Funding

We benefit from asset-driven and company-specific funding advantages, particularly our wholly owned broker-dealer, that enable us to enhance returns using appropriate leverage via low-cost and highly liquid repurchase agreements.

  • Attractive Fundamentals
    Repo funding for Agency MBS is available at extremely attractive rates due to their high investment quality, liquidity, and Agency guarantee, and the Federal Reserve’s support of the repo market ensures ample liquidity and financing availability.
  • The AGNC Advantage
    Our track record, scale, and the differentiated capabilities provided by our broker-dealer subsidiary facilitate access to­­ a diversified set of counterparties, wholesale funding rates, and reduced collateral requirements for our financing instruments.

Risk Management

We employ a variety of investment and risk management strategies to reduce market risks, continuously adjusting our hedge portfolio, duration position, and leverage to optimize returns as market conditions evolve.

  • Attractive Fundamentals
    With a portfolio largely free of credit risk, we utilize advanced tools to manage interest rate and other market risks through cost-effective and highly liquid hedging instruments.
  • The AGNC Advantage
    We employ dynamic risk modeling across current and prospective market scenarios to actively manage portfolio risks while providing stockholders transparent disclosure related to our risk strategies, duration position, and portfolio sensitivities.

The Result:
Delivering Stockholder Returns

AGNC’s opportunistic approach combines asset selection expertise, competitive funding advantages, and disciplined risk management to lay the foundation for superior long-term value generation.

Our levered Agency MBS portfolio produces attractive risk-adjusted returns predominantly in the form of monthly dividends, while our risk management strategies aim to reduce fluctuations in net book value over a range of market scenarios.

As a leading Agency MBS investor, AGNC has produced a track record of outperformance since inception – which includes attractive current dividend income – while maintaining a stockholder-focused operational approach.

Our Portfolio