Yesterday, American Capital Agency's (NASDAQ:AGNC) CIO, Gary Kain, spoke at a conference and revealed further details behind his company's odd strategy of buying common shares of its competitors, like Hatteras Financial. The move has turned out to be a great one for American Capital Agency as the sector has rallied and valuation multiples have increased. So far in 2014, Hatteras Financial has given investors a total return of nearly 30%.

In the following video, Motley Fool banking analyst David Hanson discusses Kain latest comments and tells investors why American Capital Agency won't always employ this unique strategy going forward.