Moody’s Investors Service recently upgraded three early GSE risk-sharing transactions from 2013 and 2014 that performed better than the rating service initially expected. Freddie Mac’s STACR 2013-DN2 and STACR 2014-DN1 along with Fannie Mae’s CAS 2014-C01, each designed to provide credit protection against the performance of reference pools of prime first-lien conforming mortgages, were upgraded. These are different from a typical residential mortgage backed security transaction in that note holders aren’t entitled to receive cash from the mortgage loans in the reference pools. Instead, Moody’s said the timing and amount of principal and interest that Freddie or Fannie are obligated to pay on the notes are linked specifically to the performance of the mortgage loans in the reference pool.