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Mortgage Investment Stocks Offer High Yields

Investors looking for high yields may want to consider specialty finance companies that invest in residential mortgage-backed securities (RMBS), residential mortgage loans and real estate-related securities. The primary objective of these companies is to pay dividends with high yields and, secondarily, provide capital appreciation.

Many of these companies operate as real estate investment trusts (REIT), so they are required to pay out 90 percent of their earnings to avoid paying corporate taxes.

These stocks are volatile and some companies have a history of cutting dividends.

Here is a table of 8 high-yield mortgage investment stocks.

Mortgage Investment Stocks
Annual Dividend & Yield
Annual Dividend 100 Shares
Price to Annual Dividend Ratio
1-Yr Price Chart
Annaly Capital Management
1.20 (11.66%)
Anworth Mortgage Asset Corporation
0.56 (11.27%)
Capstead Mortgage Corporation
0.56 (6.26%)
Chimera Investment Corporation
2.00 (10.94%)
Cypress Sharpridge Investments
0.88 (11.73%)
MFA Financial
0.80 (10.55%)
New York Mortgage Trust
0.80 (13.31%)
PennyMac Mortgage Investment Trust
1.88 (9.90%)
Sum Dividends
Price and dividend data from Quandl. Dividend, yield and price to dividend ratio as of Jul-01-2018.

To inspect the performance of the Mortgage Investment Stocks portfolio, see the returns table and chart below. Portfolio values are computed using monthly closes for from Quandl.

The 6 included in the portfolio computations are: NLY, ANH, CMO, CIM, MFA and NYMT. The current value of the portfolio assumes that $1,666.67 was invested (total of $10,000) in each at its closing weekly price for the current date in 2008. CYS and PMT were excluded from the portfolio computations because of insufficient price data.

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