A recent flurry of large losses by some Ohio municipalities dealing in mortgage-backed security derivatives has Fannie Mae and Freddie Mac anxiously awaiting the publishing of new investor guidelines that the GSEs hope will better educate small investors on the risks associated with those instruments.

The new guidelines, created by the Public Securities Association in conjunction with Fannie Mae, Freddie Mac, Farm Credit System, Federal Home Loan Bank System, Federal Agriculture Mortgage Corp. and the Student Loan Marketing Association, call for a greater, more timely distribution of investment details and documents to help investors better understand what they are buying. The guides take effect Jan. 15, and PSA member adherence is free.

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