Hatteras Financial Corp. is an externally managed mortgage real estate investment trust (REIT) that invests primarily in single-family residential mortgage real estate assets, such as mortgage-backed security (MBS) and other financial assets. MBS are pass-through securities consisting of a pool of mortgage loans. The Company invests in both adjustable-rate and fixed-rate MBS. Adjustable rate mortgages (ARMs) are mortgage loans that have floating interest rates. All of its fixed-rate MBS are 10-year and 15-year amortizing fixed-rate securities. The Company has primarily invested in MBS issued or guaranteed by the United States Government agency, such as Ginnie Mae, or by the United States Government-sponsored enterprise, such as Fannie Mae or Freddie Mac. The Company is externally managed and advised by its manager, Atlantic Capital Advisors LLC (ACA).