Mortgage trading on Wall Street is in a lull as investors ponder whether to seize buying opportunities in non-agency-backed securities or wait for the New Year to jump into the more liquid conventional market.

Spreads against Treasuries for pass-throughs -- the most liquid securities traded on Wall Street -- have tightened since the summer, making them less attractive to investors. Nonagency mortgages offer a higher yield, analysts said.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.