Some investors say Ginnie Mae securities are the best buy in mortgage-backed bonds now that they are in scarce supply, the volume of Treasuries is shrinking, and Fannie Mae and Freddie Mac are taking heat over their government ties.

But a prominent Wall Street analyst disagrees.

Arthur Q. Frank, the head of mortgage research at Nomura Securities International Inc., said he thinks Ginnies are fairly priced. "I see Ginnies as more of a 'hold' rather than a 'buy' at this point," he said.

Mr. Frank said that while issuance of Ginnies has been dropping sharply since the fourth quarter because of Ginnie's loss of FHA loans to the Federal Home Loan banks, the future scarcity of Ginnies ultimately depends in part on who is running the Federal Housing Finance Board.

Bruce Morrison, who resigned as chairman two weeks ago to take a public relations job, steered the Home Loan banks' shift from buying mortgage-backed bonds to buying whole loans including FHA loans, Mr. Frank said. In the near term, he said, the Home Loan banks will continue to buy FHA loans, keeping the supply of Ginnie bonds down.

What happens in the long run, though, will be dictated by Mr. Morrison's successor. One has not yet been named, but President Clinton could make a recess appointment when Congress takes a break. If he does not, Federal Housing Commissioner William C. Apgar, who represents the Department of Housing and Urban Development on the board, could become acting chairman.

Ginnies have appreciated recently on the perception of heightened political risk in Fannie and Freddie issues. One argument in their favor is that they are a better investment than Fannie and Freddie because they benefit from a full faith and credit guarantee from the U.S. Treasury.

But history has shown that the Treasury's backing is not always enough to boost Ginnie prices over Fannie's or Freddie's prices.

"For a long time, Ginnie didn't benefit from being full-faith versus Fannies," Mr. Frank said. Though Ginnie's credit is better, he said, Fannie and Freddie still have strong credit. Also, he said he does not expect any change in Fannie or Freddie's relationship to the Treasury this year or next.

Mr. Frank said his decisions revolve around relative value. At midday Tuesday, Ginnie 7.5%-coupon bonds were trading above comparable Fannie securities by 0.75 points, and Ginnie 8%-coupon securities were 0.6875 points above Fannie's. Mr. Frank said that if those price differentials get down to 0.5 points he will buy Ginnie securities. But "if it's at a full point, then we would buy Fannie's."

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