The Hidden Threat to Massive Dividends (AGNC, ARR, CIM, IVR, NLY)

The Hidden Threat to Massive Dividends

The economic downturn has been a boon to mortgage REITs and the dividends their investors collect. Relatively slow refinancing activity during the downturn has meant big profit spreads without the downside of prepayments for mREITs, such as Annaly Capital (NYSE: NLY ) , Chimera (NYSE: CIM ) and Invesco (NYSE: IVR ) , to name a few.

However, the White House and the Fed are starting to get some traction in their efforts to help homeowners capitalize on record low interest rates. August prepayments hit their highest level in seven years. Ilan Moscovitz and Austin Smith discuss what this could mean for dividend investors. Annaly investors, in particular, have been on the receiving end of huge dividends lately, but there are some crucial issues to understand before buying the stock. In this brand new premium research report on the company, our analyst runs through these absolute must know topics, as well as the future opportunities and pitfalls of their strategy. Click here now to claim your copy.

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Austin Smith has no positions in the stocks mentioned above. Ilan Moscovitz has no positions in the stocks mentioned above. The Motley Fool owns shares of Annaly Capital Management. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Report this Comment On October 21, 2012, at 4:14 PM, DrJCA1 wrote:

While we have thousands of experts and pundits, no one knows what is going to happen. I read opposing articles every day on every investment out there. I have a nice position in AGNC and will keep it. Even if they lower their payouts somewhat, it still beats most other stocks. This past year I've made 30% on my AGNC.
Report this Comment On October 21, 2012, at 10:28 PM, networkteacher wrote:

If the US were to put pressure on the Fed to raise interest rates, doesn't that also mean that T-Bills require more interest to be paid on them? If that is true, it would seem to compound the challenge of paying down the national debt. Other than election time politics, how does this help the US? or anybody else for that matter?

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	S&P 500	1,649.60	-0.91	-0.06%
	NASD	3,459.14	-0.28	-0.01%

IVR	$19.42		+0.00	+0.00%
Invesco Mortgage C…		CAPS Rating:

NLY	$14.42		+0.00	+0.00%
Annaly Capital Man…		CAPS Rating:

CIM	$3.16		-0.04	-1.25%
Chimera Investment		CAPS Rating:

AGNC	$27.72		-0.33	-1.18%
American Capital A…		CAPS Rating:

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The Hidden Threat to Massive Dividends

Comments from our Foolish Readers

Report this Comment On October 21, 2012, at 4:14 PM, DrJCA1 wrote:

Report this Comment On October 21, 2012, at 10:28 PM, networkteacher wrote:

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