The mortgage REIT industry is fairly simple to demystify. Companies like Annaly are looking to borrow money at lower short-term rates and use this capital to purchase higher-yielding long-term assets, such as mortgage-backed securities (MBSs). The difference in average yield received from MBSs minus the average short-term borrowing rate is known as net interest margin. Annaly is always looking for ways to boost its net interest margin.