STRATEGY
Our objective is to provide attractive returns to our investors through a combination of dividends and capital appreciation. We will seek to achieve this objective by opportunistically investing in a diversified investment portfolio of real estate securities and various other asset classes. We believe that this strategy will permit us to be opportunistic and invest in those assets that generate attractive risk-adjusted returns, subject to maintaining our REIT status and exemption from registration under the 1940 Act. We will benefit from the full range of experience and depth of resources developed by GSC Group. We believe this experience will allow us to create a diversified portfolio that will provide attractive returns to investors. Additionally, we intend to utilize our structuring expertise to create custom tailored securities designed to enhance returns in the REIT.

We will rely on GSC Group's expertise in identifying assets within our target asset classes that will have limited price volatility risk, yet will provide consistent, stable margins. We expect to make portfolio allocation decisions based on various factors, including expected cash yield, relative value, risk-adjusted returns, current and projected credit fundamentals, current and projected macroeconomic considerations, current and projected supply and demand, credit and market risk concentration limits, liquidity, cost of financing and financing availability, as well as maintaining our REIT qualification and exemption from registration under the 1940 Act.

Our targeted asset classes and the principal investments we expect to make in each are:

In addition, subject to maintaining our qualification as a REIT, we may invest opportunistically in other types of investments within GSC Group's core competencies, including investment grade corporate bonds and related derivatives, government bonds and related derivatives, and other fixed income related instruments. We intend initially to invest a substantial portion of the net proceeds of this offering in U.S. government agency and AAA-rated hybrid adjustable rate RMBS pending the full implementation of our diversified investment strategy. We expect to reallocate a portion of the net proceeds from this offering into a more diversified, less correlated portfolio of investments within nine months, subject to the availability of appropriate investment opportunities.

Because we intend to elect and qualify to be taxed as a REIT and to operate our business so as to be exempt from regulation under the 1940 Act, we will be required to invest a substantial majority of our assets in qualifying real estate assets, such as certain types of MBS, and loans secured by mortgages on real estate. Therefore, the percentage of our assets we may invest in ABS, bank loans, leveraged finance instruments and other types of instruments will be limited, unless those investments are structured to comply with various federal income tax requirements for REIT qualification and the requirements for exemption from 1940 Act registration.

Although we intend to focus on the investments described above, our investment decisions will depend on prevailing market conditions. As a result, we cannot predict the percentage of our assets that will be invested in each asset class or whether we will invest in other classes or investments. We may change our investment strategy and policies without a vote of our stockholders.