In this video, Foolish financial analyst Matt Koppenhaffer gives a word of caution regarding mortgage REITs. To be sure, the double digit dividends paid by these firms is appealing. However, many mortgage REITs invest in repurchase financing agreements that generate minimal returns. Even though these REITs are not heavily leveraged relative to banks, Matt believes many investors may be underestimating the risk/reward ratio these REITs possess.
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Who Will Really Get Burned on mREITs?
NYSE: NLY
Annaly Capital Management

A word of caution to REIT investors about some of the high dividend yield mortgage REITs today.
Matt Koppenheffer has no position in any stocks mentioned. The Motley Fool owns shares of Annaly Capital Management. 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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