AGNCN

AGNC Investment Corp. is the second-largest agency mortgage REIT after Annaly, and its preferred stock AGNCN offers attractive income from a pure-play agency MBS portfolio. AGNC invests exclusively in agency mortgage-backed securities — bonds guaranteed by U.S. government agencies — which eliminates credit risk on the underlying portfolio.

The yield on AGNCN is driven by the leverage AGNC uses to amplify returns on relatively low-yielding agency MBS. This leverage creates interest rate sensitivity — the preferred's price will fluctuate with rates — but the preferred dividend sits ahead of common distributions in AGNC's payment waterfall.

AGNC has paid preferred dividends consistently through multiple interest rate cycles, and the company's agency-only mandate means there is no credit risk embedded in the portfolio. For income investors comfortable with interest rate volatility, AGNCN offers an attractive yield from a well-managed mortgage REIT.