FNMAS

FNMAS is the Series S preferred stock of Fannie Mae, the government-sponsored enterprise that guarantees approximately half of all U.S. mortgages. Since the 2008 conservatorship, Fannie Mae's preferred shares have traded as speculative instruments — their dividends are suspended, but they carry enormous potential upside if the GSEs are ever released from conservatorship and recap.

The bull case for FNMAS is straightforward: Fannie Mae earns $15-20 billion per year in net income, making it one of the most profitable companies in America. If conservatorship ends and preferred shareholders are made whole at par, FNMAS would represent a massive return from current prices. Multiple legal cases, including Collins v. Yellen, have addressed preferred shareholder rights.

The risk is equally clear: the U.S. government has maintained conservatorship since 2008, the net worth sweep sent all profits to Treasury for years, and there is no guarantee that preferred shareholders will ever receive par value. This is the highest-conviction, highest-risk preferred stock trade in the market — and it has been for over 15 years.