Are High Dividend Yield REITs Worth It?

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Are High Dividend Yield REITs Worth It?

For myself I hate investing in low yield stocks that produce a 1% -5% yield which are considered safe stocks. But to be honest I haven't found that to be the case of the years. These heavy stocks are often hurt just as bad if not worse during a bear marketing while REITs on the other hand have outperformed and out paid.

*Do your own researching before investing. This article is for entertainment purposes only and is not financial advice.

I have a huge passion in building passive income but also understand with that constant work is required to fuel it and manage it all. I think it's pretty natural for myself to take on riskier investments well because I jumped into crypto in 2011 which was most likely a very risky investment back in the day. That's why I often dump funds into high yielding dividend stocks that I feel will last and produce around 10% yields. In this article I'm going to list a number of dividend stocks that are currently paying out over 10% yields with some of my thoughts on each of them. Remember do your own research.

NLY Annally Capital Management

This stock currently pays at 16.26% dividend yield. I bought this one some time ago and yes the price has fallen. However that dividend yield and a few rebuys into the dips have kept my dividend yield rather high. In fact it's one of my bigger dividends every three months and always a nice welcomed joy when it comes in.

The company diversifies assets from both residential and commercial. Primarily it's focused in mortgage loans and while those have been record low for years they are now starting to return to all time highs which could mean two things. This stocks in for a rally and the dividend yield could very well increase. This is because REITS are required by law to pay out 90% of the revenue earned to share holders.

CIM Chimera Investment Corporation

This is another I invested in years ago. Again prices are way down but the important thing to not there is where it was before the covid lockdowns. These types of stocks suffered heavily during the FED 0% rates and it's going to have a lag effect on their earnings. With the FED increasing rates and people taking on more and more loans rapidly this stock could be a solid bet.

CIM Is your classic real estate investment trust (REIT) It's investment is through subsidiaries such as mortgage assets for residential and CMBS/ non-agency RMBS. The current dividend yield is 13.75%

EARN Ellington Residential Mortgage REIT

Another of your classic REITs which primarily focuses in residential mortgages. The big key take away on this one is primarily they are government sponsored U.S government mortgages. Of course it still has many risks as with any but it's a little more on the safer bet for REITs if you are looking at the long term yield.

Important Note: When looking at APRs for dividends think of it as if you put $100 in today and that dividend stock pays you the same over the course of 5 years you would have broken even with your dividend and how hold the stock as profit or any dividend after that as profit. That's because a 20% APR (if it holds for 5 years) would mean 20% paid back to you each year.

What are you thoughts on high yield REIT stocks?

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