Annaly Capital's Book Value Gets Dented By the Fed

The Federal Reserve has been buying mortgage-backed securities since the early days of the COVID-19 pandemic, which has helped bolster book value for these companies. The Federal Reserve has signaled that it is about to start reducing the size of its balance sheet, and it will lean toward selling mortgage-backed securities in order to accomplish that. Annaly Capital is one of the big buyers of agency (in other words, government-guaranteed) mortgage-backed securities, which are similar to the Fed's holdings.