Company: ADAMM
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001273685-25-000047
Chunk: 104

Company: ADAMAS TRUST, INC.
Filing Date: 2025-05-02
Form: 10-Q
Item: Part I, Item 1
Chunk 104
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 Preferred equity and mezzanine loan investments410 (4,777)5,187 Investment securities86,504 (33,246)119,750 Mortgage servicing rights(706)— (706)Total unrealized gains (losses), net$118,203 $(39,390)$157,593 

We recognized net unrealized gains in 2025 primarily due to a decrease in interest rates, which impacted the pricing of our investment securities and residential loans. The net unrealized gains on our investment securities were partially offset by unrealized losses on our derivative instruments, as discussed below. 

In 2024 we recognized net unrealized losses, largely due to increases in interest rates, which primarily impacted the pricing of our Agency RMBS. The net unrealized losses on our investment securities were more than offset by unrealized gains on our derivative instruments, as discussed below. 

(Losses) Gains on Derivative Instruments, Net

The following table presents the components of (losses) gains on derivative investments, net for the three months ended March 31, 2025 and 2024, respectively (dollar amounts in thousands):

Three Months Ended March 31,20252024$ ChangeUnrealized (losses) gains on derivative instruments$(71,278)$45,034 $(116,312)Realized gains (losses) on derivative instruments24,476 4,177 20,299 Total (losses) gains on derivative instruments, net$(46,802)$49,211 $(96,013)

We recognized net losses on derivative instruments in 2025, primarily due to decreases in interest rates which resulted in lower valuations of our interest rate swaps. This was partially offset by gains realized on contract terminations and net payments received on instruments in 2025.

We recognized net unrealized gains on derivative instruments in 2024 due to an increase in interest rates, which resulted in higher valuations of our interest rate swaps and interest rate caps. The Company also recognized realized gains on contract terminations and net payments received on instruments in 2024.

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Income (Loss) from Equity Investments

The following table presents the components of income (loss) from equity investments for the three months ended March 31, 2025 and 2024, respectively (dollar amounts in thousands):

Three Months Ended March 31,20252024$ ChangePreferred return on preferred equity investments accounted for as equity$2,207