Christopher Nolan: Okay. And I guess my follow-up question would be, given the increased reliance on hedging for income, should we look at EPS, distributable EPS to be somewhat more divorced from the overall performance of the company?
Smriti Popenoe: We have talked a lot about EAD being a limited metric in general. And I would say, focus on total economic return. Rob can take you guys through once again, just like the A plus B plus C plus D on the hedge gains. And maybe you should do that. Now, Rob, in terms of just how to how to think through EAD plus, what is more directionally correct.
Byron Boston: Hey Chris. Go ahead Rob.
Rob Colligan: Sure. So, yes, thanks for the question. One of the things that we added this quarter, just to highlight rate moves and how we look at the portfolio. We added a chart on Page 8 of the earnings deck. So, you would see, as you would expect, repo expenses are up. Both our interest income and our hedge gains have also ramped up this year. So, that’s how we are feeling that we are insulated from a lot of the rate moves and how we are using our hedge book to supply either a buffer against rising rates or even just simply income. I think it’s an interesting market factor that right now, if you have a future on because the rate curve is inverted. We actually get paid to put a hedge on whether that is a future or a swap.
There haven’t been that many times in my career that that has happened. But it’s an interesting market dynamic that will actually add to that hedge benefit in 2023. We will see how long it lasts. But the market dynamics are a little bit different now. So, we are adjusting to that and doing a good thing for earnings and book value.
Byron Boston: And Chris, I am going to just finally just chime in on one other piece as a long-term investor in Dynex Capital. And a very, very €“ we are very responsible for our shareholders. I am looking at this graph that we have shown you on Slide 9. So, when we talk about performance, what’s the worst in that? I am simplifying it for you. On Slide 9, I am going to be looking at that $19.51. And I am going to be looking at it as I continue to add a monthly dividend to that number. And we are looking to regain our book value over time. And I am going to be looking at that number to go up. That’s what I am looking to do. And that’s the way I am going to be thinking about our performance here at Dynex Capital. And the other piece in this would be to really understand, and Smriti made this comment in her statement.
We didn’t take permanent hits to capital in 2020 or 2022. So, when you look at that bar, and please make €“ you do the same graph for every company that you might consider to analyze or invest in, and then look and compare to us again. Over time, this says, we are concerned with our shareholders savings. We want to deliver a solid cash income. And then we want to make that final bar continue to move up over time. So, when we say performance and how do we think about our performance, we simplify it in that graph. You can come up with all kinds of funky GAAP terms. But at the end of the day, our shareholders are expecting an above average dividend cash, cash income, which we are looking to continue to pay on a monthly basis. And we are looking to maintain the book value over time.
Christopher Nolan: Okay. Thanks guys.
Operator: And that does conclude the question-and-answer session. I would like to turn the call back over to Byron Boston for any additional or closing remarks.
Byron Boston: Thank you so much for joining us. I want to emphasize to you that we are long-term investors, skilled risk managers, disciplined capital allocators. Today, we have allocated our capital to the agency mortgage backed security sector. I will emphasize, we are not an agency only REIT. We are not doing the new hot thing. We are investing for the long-term. When we think about our costs, Doug, I appreciate you are asking that question. We are thinking about our costs over time and can we generate a higher return. And then I will emphasize to you. Get familiar with that slide, Slide 9, we like that. It shows our accumulated dividends along with where we are and our track record in terms of our book value. And when you are a little confused about who is managing your money in this decade, very important to ask yourself that, create that graph for every company that you consider and then compare it.
We appreciate you joining us this quarter. And we look forward to chatting with you again at the end of the first quarter sometime in April. Thank you very much.
Operator: Thank you. And that does conclude today’s presentation. Thank you for your participation and you may now disconnect.
