Two Harbors Investment Corp. is a Maryland corporation focused on investing, financing and managing residential mortgage-backed securities (RMBS) and related investments.
Our objective is to provide attractive risk-adjusted returns to our stockholders over the long term, primarily through dividends and secondarily through capital appreciation. We selectively acquire and manage an investment portfolio of our target assets, which is constructed to generate attractive returns through market cycles. We focus on security selection and implement a relative value investment approach across various sectors within the residential mortgage market. Our target assets include the following:
- Agency RMBS (which includes inverse interest-only Agency securities classified as Agency Derivatives for purposes of U.S. GAAP), meaning RMBS whose principal and interest payments are guaranteed by the Government National Mortgage Association (or Ginnie Mae), the Federal National Mortgage Association (or Fannie Mae), or the Federal Home Loan Mortgage Corporation (or Freddie Mac);
- Non-Agency RMBS, meaning RMBS that are not issued or guaranteed by Ginnie Mae, Fannie Mae or Freddie Mac;
- Prime nonconforming residential mortgage loans and mortgage servicing rights (MSR);
- Commercial real estate debt; and
- Other financial assets comprising approximately 5% to 10% of the portfolio.
We have elected to be taxed as a real estate investment trust (REIT) for U.S. federal income tax purposes, which requires that we distribute at least 90% of our REIT income to our stockholders on an annual basis.