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Blackstone Mortgage Trust
Blackstone Mortgage Trust

Real estate / REIT

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Risks

1. Interest rate risk: Interest rates can have a significant impact on Blackstone Mortgage Trust's ability to generate income from its investments. If interest rates rise, the value of its mortgage-backed securities (MBS) may decline, resulting in reduced income.


2. Prepayment risk: As interest rates decline, borrowers may choose to refinance their mortgages, effectively paying off their existing mortgages earlier than scheduled. This can reduce the amount of interest payments to Blackstone Mortgage Trust, resulting in lower returns.


3. Credit risk: Blackstone Mortgage Trust is exposed to credit risk if the borrowers fail to make their payments or if the MBS in which they invest have underlying borrowers that fail to make their payments.


4. Liquidity risk: Blackstone Mortgage Trust may not be able to readily sell its MBS investments in order to meet its liquidity needs due to market conditions resulting in reduced returns.


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