Executive Summary
Morgan Stanley's securitized products team reports the Trump administration's $200 billion GSE mortgage purchase program triggered an immediate 15 basis point rally in mortgage spreads, pushing headline rates below 6% for the first time since 2022. However, the initial move appears fully priced in. The incremental $100 billion above expected GSE purchases represents meaningful flow relative to $175 billion projected mortgage market growth, but remains small against the $10 trillion total market....
Key Investment Opportunity
Securitized Credit Portfolio Effects
GSE mortgage spread tightening creates positive spillover effects into non-agency mortgage markets through portfolio rebalancing and risk asset correlation
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