GSE securities are not backed by the full faith and credit of the U.S. government. Thus, investors purchasing GSEs are exposed to:

Name: GSE securities are not backed by the full faith and credit of the U.S. government. Thus, investors purchasing GSEs are exposed to:
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Question

Quizplus · Accepted Answer

GSE securities, while having some government association, are not fully backed by the U.S. government, exposing investors to the risk that the issuing entity might fail to meet its financial obligations, which is defined as credit risk.

GSE Securities Are Not Backed by the Full Faith and Credit