Although mortgage-backed securities may be more complex than traditional bonds, they may offer lower risk and higher yields and potentially provide a steady income when invested properly. Due to the complex nature of the product, I work closely with Stifel’s fixed income trading desks to make sure my clients are educated and kept abreast of the market. Combining my experience with a well-informed client, I seek to maximize the investor experience.

My strategy is to buy odd-lot agency mortgage-backed securities at a discount to the marketplace in an effort to receive higher yields/returns than investments with similar levels of risk.

I also seek to buy relatively short-duration municipal bonds for my clients when appropriate.

 

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When investing in bonds, it is important to note that as interest rates rise, bond prices will fall.

Mortgage-backed securities represent an investment in a pool of mortgage loans; thus, the yield and average life will fluctuate depending on the rate at which mortgage holders prepay the underlying mortgages and changes in interest rates. Your financial advisor should explain how mortgage-backed securities react to different market conditions.