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Advantus Sees Silver Linings in Stormy Mortgage Securities Market
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ST. PAUL, MN -- (Marketwire) -- 11/13/08 -- While the devastated residential mortgagemarket continues to make headlines, experts in structured finance atAdvantus Capital Management are finding opportunities in high yieldinginvestment-grade mortgage bonds.
In a paper co-authored by Advantus executives Dean Di Bias, Sean O'Connell,and Chris Sebald, they explain how "guilt by association" has caused themarket to devalue mortgage-backed securities that exhibit excellentfundamentals and credit metrics, yet trade at yields higher than B-ratedcorporate bonds.
"Securities such as these yield between 10 and 15 percent, representingextremely attractive and, we believe, safe investments," the authors say.They go on to point out that they believe that these investmentopportunities are very likely to be available for some time to come as thefinancial system "moves through its massive restructuring cycle" andadjusts to much lower leverage.
Di Bias, O'Connell and Sebald expect the housing market to remain soft formany years to come. Historically, it has taken the US market between fiveand seven years for housing to reach new highs after a real estate downturnbegins. Additionally, they expect that more financial institutions willfail, creating additional opportunities in the high-yield mortgagesecurities market.
The Advantus white paper, "How market inefficiencies are creatinghigh-yielding mortgage opportunities," is available atwww.advantuscapital.com.
Advantus Capital Management manages fixed income and real estate investmentproducts and services for institutional and retail investors, includingsub-advised mutual funds, 401(k) offerings and variable insurance andannuity portfolios. Advantus has nearly $19 billion under management. Itsparent company is Securian Financial Group, Inc., which has nearly $700billion of life insurance in force, $30 billion in assets under managementas of September 30, 2008, and a work force of 3,400 employees nationwide.Securian serves more than 9,000,000 individuals in the U.S.
NOTE: to receive hi-resolution photos of Dean Di Bias, Sean O'Connell, andChris Sebald via email, contact Margaret.jensen@securian.com
URLS:www.advantuscapital.com/adv/pdf/HighYieldMortOpp.pdfwww.advantuscapital.comwww.securian.com
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Contact:Maggie Jensen, APR651-665-7558
"Securities such as these yield between 10 and 15 percent, representingextremely attractive and, we believe, safe investments," the authors say.They go on to point out that they believe that these investmentopportunities are very likely to be available for some time to come as thefinancial system "moves through its massive restructuring cycle" andadjusts to much lower leverage.
Di Bias, O'Connell and Sebald expect the housing market to remain soft formany years to come. Historically, it has taken the US market between fiveand seven years for housing to reach new highs after a real estate downturnbegins. Additionally, they expect that more financial institutions willfail, creating additional opportunities in the high-yield mortgagesecurities market.
The Advantus white paper, "How market inefficiencies are creatinghigh-yielding mortgage opportunities," is available atwww.advantuscapital.com.
Advantus Capital Management manages fixed income and real estate investmentproducts and services for institutional and retail investors, includingsub-advised mutual funds, 401(k) offerings and variable insurance andannuity portfolios. Advantus has nearly $19 billion under management. Itsparent company is Securian Financial Group, Inc., which has nearly $700billion of life insurance in force, $30 billion in assets under managementas of September 30, 2008, and a work force of 3,400 employees nationwide.Securian serves more than 9,000,000 individuals in the U.S.
NOTE: to receive hi-resolution photos of Dean Di Bias, Sean O'Connell, andChris Sebald via email, contact Margaret.jensen@securian.com
URLS:www.advantuscapital.com/adv/pdf/HighYieldMortOpp.pdfwww.advantuscapital.comwww.securian.com
Add to Digg Bookmark with del.icio.us Add to Newsvine
Contact:Maggie Jensen, APR651-665-7558
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