Lehman Brothers Mortgage-Backed Securities Index

AAA

DEFINITION of 'Lehman Brothers Mortgage-Backed Securities Index'

An index made up of mortgage-backed securities that is used for benchmarking purposes. The Lehman Brothers MBS Index consists of fixed-rate securities, such as mortgage pools created by the Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corp (FHLMC) and Federal National Mortgage Association (FNMA). This index serves as a performance benchmark for many mortgage-backed securities funds.

INVESTOPEDIA EXPLAINS 'Lehman Brothers Mortgage-Backed Securities Index'

For a mortgage-backed security to be included in the index, it must have a minimum principal amount of $50 million. The securities within the index have an average life between 15 and 30 years. The MBS Index is a subset of the Lehman Brothers Aggregate Bond Index, which includes a larger variety of benchmark bonds.

RELATED TERMS
  1. Constant Percent Prepayment

    Annualized estimate of mortgage loan prepayments, computed by ...
  2. Fannie Mae - Federal National Mortgage ...

    A government-sponsored enterprise (GSE) that was created in 1938 ...
  3. Ginnie Mae - Government National ...

    A U.S. government corporation within the U.S. Department of Housing ...
  4. Benchmark

    A standard against which the performance of a security, mutual ...
  5. Freddie Mac - Federal Home Loan ...

    A stockholder-owned, government-sponsored enterprise (GSE) chartered ...
  6. Insider Trading

    The buying or selling of a security by someone who has access ...
Related Articles
  1. Bonds & Fixed Income

    Profit From Mortgage Debt With MBS

    Mortgage-backed securities can offer monthly income, a fixed interest rate and even government backing.
  2. Home & Auto

    How To Analyze Real Estate Investment Trusts

    REITs are much like dividend-paying companies, but analyzing them requires consideration of the accounting treatment of property.
  3. Personal Finance

    Case Study: The Collapse of Lehman Brothers

    This company survived many financial crises in its long history. Find out what finally drove it to bankruptcy.
  4. Retirement

    What is a Ginnie Mae security?

    A Ginnie Mae, or Government National Mortgage Association security, functions similarly to the process of lending someone money to purchase a house or business. Ginnie Mae buys home mortgages ...
  5. Options & Futures

    20 Investments You Should Know

    To take advantage of all your investing options, you need to know what your choices are. Here we tell you about the diverse features and advantages of 20 different financial instruments.
  6. Retirement

    What are the typical durations for a certificate of deposit?

    Investing in a certificate of deposit offers individuals the ability to earn interest on idle funds with less risk than stock or bond investments.
  7. Investing Basics

    What is the effect of price inelasticity on demand?

    Find out why price inelasticity of demand shows the relationship between demand and price if the price of an inelastic good is either lowered or raised.
  8. Investing

    Reassessing Your Approach To Bond Investing

    Rethinking your fixed-income portfolio may not resonate in quite the same way as dropping 10 pounds or finally giving up that smoking habit.
  9. Credit & Loans

    Are APRs different in different countries?

    Learn about the term APR and how it is used in the United States and other countries. Explore why different lenders charge different APRs.
  10. Credit & Loans

    What loans do and don't have an APR?

    Learn about what annual percentage rates (APR) are and what they mean. Explore different fixed and variable APRs charge by different lenders.

You May Also Like

Hot Definitions
  1. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  2. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  3. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  4. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  5. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  6. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
Trading Center