Residential Mortgage-Backed Securities (Rmbs)
Residential mortgage-backed securities cover a broad range of investment opportunities, they are collateralized by residential properties, and are one of the largest sectors within structured products and offer significant liquidity.
We believe there are many opportunities to generate alpha in the RMBS market, particularly in the Non-Agency market (bonds that are not backed by Agencies). These securities are complex and subject to different viewpoints which result in trading opportunities.
Opportunities and Trends
We believe that Non-Agency RMBS fundamentals and market dynamics will continue to support our ability to generate stable, consistent risk-adjusted returns. Axonic’s investment analytics and portfolio construction are aided by our proprietary technology which examines loan level collateral detail and determines multiple home price paths across varying scenarios.
Axonic seeks out opportunities in which a security’s pricing does not reflect its underlying value, taking an event-driven approach where possible. We see many such opportunities in legacy RMBS securitizations, whether those are Call Option or Forbearance Recovery plays.
Our models drill down on a loan level basis and use multiple data sources to analyze and stratify data on a fundamental basis. These opportunities are extremely complex and dissuades less-experienced managers from investing in them, which also creates potential for outsized returns.
We focus exclusively in the structured credit space and have since the inception of Axonic. We pass this edge on to our investors with fixed income investments that often provide enhanced returns and diversification away from the broader public markets.
Most of our executive leadership team has been together since the inception of our firm. This provides our investors with a cohesive client experience and a unique business model that has withstood market ups and downs.
An unwavering long-term view is critical to overcoming the inevitable highs and lows in market cycles. Remaining calm, relying on data and resisting the urge to react from emotion is what makes Axonic exceptional.
Combined, our firm has hundreds of years of experience in structured credit. No one is a generalist; we are all focused on our specific practice sectors that gives our team the potential of surpassing the broader markets.
For more information about our historical performance and examples of investment opportunities, please contact us. Please note this information is only available to accredited investors and qualified purchasers.