Because of the risk of pre-payment, and because the federal bodies involved are agencies, not the government itself, mortgage-backed securities trade at a discount to (or, to put it in other words, offer higher yields than) government bonds. Typically, the yield of mortgage-backed securities is about one percentage point higher than the yield of government bonds, and there can, for example, be profit opportunities if that difference widens or narrows for temporary reasons.

Donald MacKenzie, An Engine, Not a Camera, loc. 958