While ideally investors like to find companies that are attractive long-term investments that can be held for many years, some type of stocks are good investments only during certain cycles. One investment class that fits this category is agency mortgage REITs (real estate investment trusts).
These firms invest in mortgage-backed securities (“MBS”) that are backed by government or government-sponsored agencies such as Ginnie Mae, Fannie Mae, and Freddie Mac. Two firms that employ this strategy are AGNC Investment (AGNC 0.10%) and Annaly Capital Management (NLY 0.36%). Both have attractive yields of over 13% and are leaders in the space.
So, is now the right time to be buying these high-yielding stocks? Let’s find out why the answer could be yes.
What the heck is a mortgage REIT?
Mortgage REITs are essentially investment firms that own portfolios of mortgages. The companies…
