Even with the Ginnie Mae 5.5% coupon starting to move into the spotlight, analysts are hesitant to recommend an overweight in the sector yet. A sharp market sell-off could bring GNMA speeds to a near halt. This is why researchers from Goldman Sachs are suggesting investors hold conventional 5.5s rather than their Ginnie counterparts.

There are a number of indexed investors beginning to buy Ginnie 5.5s, as monthly issuance of more than $5 billion has made the coupon eligible for inclusion in mortgage indexes. Further, talk about the "scarcity value" of Ginnies has circulated, as it comprises merely 17% of the index.

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