An overweight exposure to mortgage-backed securities contributed to returns on the ma

[Eartha]

Dear all,

How should I understand the underlined?

Thanks in advance.

Eartha

Our strategies produced mixed results. Credit spreads continued to contract but unexpectedly strong economic data and rising inflation concerns drove a sell-off in the Treasury market. An overweight exposure to mortgage-backed securities contributed to returns on the margin. The sector had its third consecutive month of positive excess returns on strong carry and declining implied volatility.

[Tdol]

I am not an economist, but I would interpret it as meaning that their mortgage-backed securities performed well and added to profits, though the word overweight suggests that there might be some concern that they are overexposed to these securities.

[bwkcaj_ca]

Eartha: Despite the fact that I have a university degree in Economics, an, accounting designation and have spent many years working in the financial industry, I don't believe you need to have such a backgound to make sense of the sentences you submitted. I suspect it is not the meaning of
the sentences but the definition of the jargon being used that is causing you problems.

I agree with Tdol's explanation in large measure, though I suspect the
term 'on the margin' means that the contribution of mortgage-backed securities to aggregate returns was minimal (small.)

Why don't you google the terms you don't understand and see if that
helps?

[Tdol]

though I suspect the
term 'on the margin' means that the contribution of mortgage-backed securities to aggregate returns was minimal (small.)

Thanks for that.