ALPS Active REIT ETF
Costco - you genuinely cannot go wrong with it. Wonderful wonderful company. Visa - payments good. Not going anywhere Maybe waste management - this is not going to go away anytime soon. Digital realty trust Preetty much any REIT traded much below par value Eh - Disney, Intuit
There are several Shariah compliant products which are available. The $SPUS ETF will only give you exposure to US large cap stocks. If you are familiar with the Boglehead philosophy of investing - there are suggestions for constructing a Shariah compliant Boglehead portfolio here - [https://www.bogleheads.org/wiki/Sharia\_investing\_for\_US\_investors](https://www.bogleheads.org/wiki/Sharia_investing_for_US_investors) There are some other Shariah compliant funds available which can give you broader exposure such as $HLAL and $UMMA. [https://funds.wahedinvest.com/](https://funds.wahedinvest.com/) [https://umma.wahedinvest.com/](https://umma.wahedinvest.com/) SPFunds also offers a REIT. If you want to use a mutual fund - there is an actively managed Shariah fund - [https://investaaa.com/](https://investaaa.com/) \- but the expense ratio is a bit higher. There are also Sukuk bonds for the fixed income portion of a diversified portfolio. I am only aware of one Sukuk bond ETF which is also from SPFunds - SPSK. This investment manager offers Sukuk bond mutual funds - [https://www.saturna.com/amana/participation-fund](https://www.saturna.com/amana/participation-fund) Lastly - for generating cash yield without interest - you may be able to use box spreads - although I do not know if they are considered halal. You may also want to check out r/HalalInvestor.
I agree with you. I may be in the wrong bring up the past on a forum where the threads are up for 24 hours and then forgotten. But people were saying avoid REITs there will be a commercial real estate collapse. Basic REIT DD would tell you there are multiple REIT sectors cell tower, industrial, self storage. But for some reason sector being lumped as all commercial real estate got the most upvoted 1-2 months ago.
A lot of REITs have bounced over the last month like CCI, WPC, and EXR. Anyone else buy from that sector when people on this sub were saying the entire REIT sector is commercial real estate best to avoid not doing the basic DD that there are multiple REIT sectors.
They didn't. That's an idea from an old Ben Graham "baseline". 15 x 1.5, 15 being P/E and 1.5 being P/Book. 22.5 was considered the maximum one should pay, and it's much less relevent today in american companies. Much has changed. Book value might be an important metric for a manufacturing concern or a REIT, but it's often meaningless for a tech company.
You want to create your own REIT? Or you want to invest in a public REIT? If you want to invest in a public REIT - you can just rollover your old 401k into a 401k rollover or the appropriate IRA and invest in the public REIT. If you want to actually buy real-estate - afaik - using a SDIRA is possible. But I'm not familiar with the complexity to setup a SDIRA and funding it from a 401k. A SDIRA normally requires a custodian that specializes in handling SDIRAs.
Hey all, first time poster. I have a small 401k ($68k) from a company I used to work at. I want to begin investing in Real estate and want to know if it's possible to use this money. It was suggested to roll it into a REIT that I create. Anyone have insights or experience with this?
If your dream is to own a piece of residential real estate, then one possible strategy is to invest in a REIT that owns residential real estate. You'd be able to count on your investment at least keeping up with what you plan to eventually use it to buy. Be aware that commercial real estate could continue to be hurt. You don't want a REIT that owns cell towers, office buildings, storage centers or shopping malls if what you want to buy later is some land and a house. You want to own REITs that own land and houses and perhaps apartments. The stock market is at historically high valuations currently. Ordinarily I would say that high valuations shouldn't matter to a young person because you have a long horizon in which to recover any losses that might materialize in the next year or two. However, if you're thinking about that house in the next seven or eight years, then I'd encourage you to invest in a liquid version of what you hope to buy: residential REITs.
So simplest answer is S&P 500 funds. Better answer is to have S&P 500 as the base, but diversify by adding small amounts of REIT, Tech, International, etc. I even throw in a bit of leverage in there <10%. Then you rebalance regularly. It's the only free lunch you get in investing.
In the case of WeWork, the debt was a big obstacle. Coworking can work I believe. But it was set up as a tech company at first which are often money-burners until they either succeed or fail. WeWork is not a tech company but is a leasing company that requires a slower, steadier growth. I think they realize that now and, once they emerge from bankruptcy, will follow a more traditional model for REIT's.
Serious: Physical Real Estate. Stop renting by any means neccessary. Before lending rates were demonic, I bought and lived in a condo. Bought for 300k, sold for 560k. The subsequent windfall was; 1.) 100k in REIT for monthly income ($700). 2.) 100k for investing 3.) 50k for expenses. With the investment money, 50k into $AMZ @91, sold @ 143. Mortgage paid for 2 years. Same principal 100k for swing trading as above.
I do not recommend this at all. 1) If you own or plan on buying a home, guess what. You're VERY exposed to real estate from owning property already. It'll likely be your largest or at least second largest asset holding. 2) REITs = taxed at ordinary income 3) as everyone else said, too much exposure to one asset type, market risk will get you You'd be better off taking $400k into some US and ex-US funds (VT?) which will also have REIT exposure. Just rent a room out and call that your real estate income.
Well. I mentioned Qqqm since it seems a good addition when holding vti/voo which is basically my C fund. Been doing a lot of research plus seeing reddit, many recommend vti+qqq+schd portfolio. I would've considered dividend like schd but being taxable, REIT being a similar issue. I dont think it's that good of an idea. So I said maybe go with a more "growth" etf. I can't qualify for Roth cause of income. So In the end I was thinking about getting that extra to some growth/diverse type. With just a very small % to play with random stocks that I like. I'm looking for. Opinions to point me in the right direction so I can narrow my research.
Yeah, I think some of them might be OK for a tax-advantaged portfolio like an IRA. You just really have to crunch the numbers and see how it's going to shake out come tax season. I found that I was better off in a tax-free high(er) yield muni eft than one reit I was in; even though the muni eft had a lower yield and higher expense ratio, I still netted a better yield because of the way REITs are taxed. I would guess that most people who buy them are won over by the sometimes eye-watering yields while remaining completely clueless that REIT dividends are taxed as ordinary income.
I make about 75k a year on Groundfloor. It's similar to a REIT but less risky because you're in a first lien debt position instead of an equity position. Average returns are around 10.5%, and loss rates are about 0.5%, so you end up earning roughly 10%. Those are historic figures over the past 10 years. Recently, with the FED hiking rates, Groundfloor has raised their average contract rate to 11.5%-12%. I'm watching their monthly asset management reports closely to see the uptick in APY earned. Yes, there is the potential to lose money. All investing carries risk. Out of 2,060 deals that I've been repaid on roughly 20 have lost money (losing an average of about 8% of principal after foreclosure) 35 of them or so have paid with less interest than promised or 0 interest, and the remaining 2,005 all paid with promised interest or higher. Do some DD, and if you're interested, DM me, they have a great referral program!
The math is simple. First how much money do you have. Divide that by the share price. Take total number of shares and multiply by dividend amount. That is how much you will be receiving in payments. Remember it is taxable. Is that more or less than what you will receive leaving the money in a high yield account or investing in TBills or bonds, which are often times only partially taxed. Long story short there is no free money glitch. If you have enough money to buy enough REIT stock to make any sort of meaningful "passive income" you probably have enough money to invest in something else like property. However your milage may vary and do your own math first.
People sleep on American Tower, they own a lot of global communication infrastructure properties with really high margin business and have been making a play into data centres recently. Given the 5g stuff going on and how their business is setup to profit from it I think they are a safe REIT play not involved in the CRE business.
REIT”s may underperform the market during periods of monetary tightening, as higher rates increase the cost of borrowing and reduce the attractiveness of REIT dividends. But now Fed seems to be done with interest rate hikes so we can expect growth would come back in in housing market as interest rate start reducing slowly
There are a few real estate ETF's like Vanguard's VNQ that may be worth taking a look at. The dividend is not as large as some of the REIT's out there. But the ETF has a spread of multiple companies and industries. So it is somewhat insulated from a weak stock from one company.
REITs own more than commercial office buildings. Strip malls, apartments. I also think people are overreacting to REITs a bit. Yes WFH will really impact office demand, but mostly for older buildings. REITs will still have commercial office lease that are profitable for dentists and medical buildings for example, warehouses, server storage, storage units. If a REIT is all business office space it’s going to get crushed, sure, but a diversified REIT with mechanic shops and apartments is going to be absolutely fine.
Agreed. Watch out for the ones that aren't really doing any property acquisition at all themselves, but rather a REIT of REIT of REIT of REIT management. Those guys are absolute snakes. Just stick with the biggest players. Same for tech. It's super high risk to chase the fly-by-night little players. IF they are even honest and not cooking the books, they are still high risk compared to the mega sized players who own the friggin markets.
The mega techs are doing fine. You aren't going to see people giving up their iPhones and MacBooks any time soon. So, those tech stocks have faired well for me, but my smaller tech stocks were wiped down 25 to 40% when the Fed started their rate hiking. Just absolutely devastating. And unfortunately, for my age-balanced 401Ks, my brilliant fund managers decided to shift us out of "risky growth" and into "safe banking" for our age, at precisely the worst time possible for both. Mostly tech at their lows, and into banking at their highs, and then well... we all know what the bankers did next. They sold the shares they gave themselves for years to our fund managers who used OUR earnings to liquidate them, then they headed off to Cayman island resorts as the regulators consolidated over the course of a single weekend, in mere hours, they rendered a huge portion of 401Ks and huge pensions in those banks completely worthless, while shouldering tax payers with the worthless assets and giving even bigger banking buddies the valuable assets. So, you could have been agile, had control of your 401K, and could have predicted what they did, you'd fair well. Back to point though, 25 to 40% down on almost everything, but only 12% down on my REITs, and likely not even that bad now. We've been collecting steady dividends for months. And I just started buying into another one that is interesting because of what I've been hearing from younger working class people. They say they can't afford houses. It looks true. Hell I can't afford my house and I've owned it for well over a decade, but the tax collector keeps jacking up taxes, damned determined to push us out so another investor can grab another rental. Anyhow, the developers started building cramped multi-unit condo things all over the place, and to do that, they aren't running to banks to borrow, but rather REIT loan / investment companies that give them better terms for short term loans. Point being, for quite a while I thought, meh, steer clear of housing, and stick with triple-net commercial property REITs, BUT after seeing what is happening at ground level, it looks like a great time to me to own the debt of the big developers building big condos and more. TLDR; Who the hell knows. Everything is down, but good REITs tend to have steady income to soften the wild tampering and manipulations of the Fed and government. I don't think the working class can take these rates and massive job losses much longer, so it's not a matter of IF the Fed backs down, but when and it's looking like the slap of reality will make that sooner than later. WHEN that happens, the REITs will shift back from self-financing to their banker bros and we should see some rise in valuations while you've also locked in some good divvy income. Not advice. Just my rambling opinions.
Your proposed asset allocation is a good starting point, and it's well-diversified across different asset classes. Here are some specific thoughts on your allocation: ​ **VOO (55%):** S&P 500 index fund is a good choice for a core equity holding. It provides broad exposure to the US stock market, with a track record of long-term growth. ​ **VXUS (15%):** Total world stock market ex-US index fund is a good way to add diversification to your equity holdings. It provides exposure to developed and emerging markets outside of the US. ​ **Small-cap ETF (5%):** Small-cap stocks have historically outperformed large-cap stocks, but they also come with more risk. A small allocation to small-cap stocks can help to boost your potential returns, but it's important to be comfortable with the additional risk. ​ **Mid-cap ETF (5%):** Mid-cap stocks offer a balance between risk and return, and they can be a good way to diversify your equity holdings. ​ **VNQ (4%):** Vanguard REIT ETF is a good way to add exposure to real estate to your portfolio. REITs can provide income and diversification, but they are also sensitive to interest rates and economic conditions. ​ **VNQI (2%)**: Vanguard Infrastructure ETF is a good way to add exposure to infrastructure to your portfolio. Infrastructure can provide income and diversification, but it is also sensitive to economic conditions. ​ **Treasury/Muni Bond ETF (5%):** Treasury and municipal bonds can provide income and diversification to your portfolio. Treasury bonds are backed by the full faith and credit of the US government, while municipal bonds are backed by the taxing authority of state and local governments. ​ **Corporate Bond ETF (5%):** Corporate bonds can provide higher yields than Treasury or municipal bonds, but they also come with more credit risk. ​ **Gold (2%):** Gold is a traditional hedge against inflation and can provide diversification to your portfolio. ​ **Individual stocks (1%):** Investing in individual stocks can be a great way to boost your returns, but it's important to do your research and understand the risks involved. ​ **Bitcoin (1%)**: Bitcoin is a highly speculative asset, and it's important to only invest money that you can afford to lose. ​ Overall, your proposed asset allocation is well-diversified and reflects your risk tolerance. I would encourage you to review your allocation regularly and make adjustments as your circumstances change. ​ Here are some additional tips for investing: ​ **Make sure you have an emergency fund of 3-6 months of living expenses.** This will help you to avoid selling investments when the market is down. ​ **Invest for the long term.** Don't try to time the market. Instead, focus on investing consistently and taking advantage of dollar-cost averaging. ​ **Don't over-diversify.** Diversification is important, but too much diversification can lead to lower returns. ​ **Rebalance your portfolio regularly.** This will help to ensure that your asset allocation remains aligned with your risk tolerance
This is not an easy calculation to make, but I encourage everyone to do it. Saving for a house has been made almost impossible, and I think that is on purpose. The entire system is setup to turn working class into indentured servants to the wealthy, generation after generation. For example, say you were saving for a house or car over the past 5 years. You would have been a fool to have put your money into the bank to do so. So, you took the advice of fund managers. You bought a dividend stock, maybe a REIT or a bank or even a car manufacturer. You started off good, and added to it every paycheck. Things are looking brighter for you every day. You're on track to reach your goal in... a decade or so, but keep at it, right? Unfortunately, about every 7 to 10 years we go through a massive rebalancing of wealth in this country. They cleverly shunt purchasing power away from the working class and to the uber wealthy and politically powerful. In less than 3 years, you watched the dollar diluted. Devalued. Again, this is nothing new. It's new to the latest generation of working class, but many of us have seen these same tactics 2 and 3 times in our careers. This time around, the tactics were the same, the outcome the same, the story just changed for why. They took over 30% of your purchasing power on wages, but also lifetimes of savings, which you may have had in attempts to save for home, a car, college or whatever might change your station in life. That purchasing power was cleverly targeted and stolen. It was shunted from your pocket, your accounts, your investments to the wealthy and powerful by providing them with near to zero rate loans, and this time, even loans that never need to be repaid. What did they do with it, while you were diligently saving? They bought up housing this time, and turned it into rental properties. Anyhow, back on point. You lost more than 30% of purchasing power on every single dollar, your current wages, and those you've been saving possibly for a lifetime. THEN, they started wiping down the markets after they'd sheltered themselves in businesses and properties, where they jacked prices and rent. Think of it like this. If you were saving for a car and you stored $100 in a share of a car company. Each dollar now only has 70% of the purchasing power due to devaluation of the dollar. AND, then the rate hikes took your investment down another 20 to 30%. So after 3 years of diligently saving, you now have less than 50% of the PURCHASING POWER that you started with. Same for houses and many other things that are true wealth, truly empowering. And that, none of that even touches on the reality of taxes, which will take a huge share of any possible numeric gains you have, while completely ignoring the loss of purchasing power. Anyhow, is it better to save and invest or buy? IF you can shunt your investments into tax sheltered accounts, THAT would work. If you do it the way you describe, it will fail.
Sure it's easy money. NOT! Let's see. Insurance, property taxes, calls at 3 AM when the heater stops working or AC malfunctions. Acts of god-bad storms, roof damage, fighting with insurance companies to cover a repair. Giving tenants some place to live in the meantime during these events. Dealing with tenants who decide to become squatters. REIT stocks are a much better hands off approach to investing in real estate. Let organizations run by people much smarter than you do the heavy lifting. Find REIT's that have decades long track record of paying dividends and are a good value proposition going forward. That's easier money. But honestly your best bet is to start with a money market fund like a Schwab SWVXX paying 5.26%. Your money is safe, liquid & gives you time to explore your options with index funds, ETF's and maybe some REIT's after you educate yourself. I wouldn't take the advice of many saying you should buy rental properties. That's a recipe for headaches & disaster if you don't know what you are doing.
It's a mortgage REIT - it's really not very suspicious. REITS are structured as RICs so they are required by law to distribute at least 90% their net income annually. (Although I think the percentage has changed in last few years). The comments by u/NFPA59A is probably just a misunderstanding about the topic. I don't think that a lot of retail investors in this subreddit are familiar with these types of investing strategies. While it's not technically an arbitrage - it's an income capture strategy which is implemented by building a delta neutral position which hedges any price movement. The risks of these strategies depend on what is being captured. In this case - what makes it interesting is that it's not just the dividend but potentially also the lending fee. The actual downside risk is fixed and capped. But so is the upside since it's a capture strategy. The challenge in implementing this strategy with a mortgage REIT usually is in the option skew where the premium in the long puts would be higher than the short calls. And from a benchmark perspective - these types of strategies aren't measured against equities. I actually don't know what would be an appropriate benchmark - maybe some arbitrary amount of bps above the risk-free rate. Or maybe against the average expected yield to maturity of a basket of investment grade corporate bonds or some other fixed income index.
A short combo is actually a good idea, kind of like I described in my post with selling the call and buying the put, but more specific, I like it. About your question: Part of why I picked ABR was to capture a part of the lending yield. I also certainly believe in the future of ABR, even though they are looking very beat up now. Being a REIT is an advantage and yes, when investing in real estate, that is the way to go for me, but not my main requirement when searching for companies in general.
Looking for investment advice. I am 27, living in Florida, and am active duty military. I purchased my first home two years ago for 235k. It is now worth 307k at a 3% interest. My mortgage is 1380 a month. I currently am renting it out for 1900 a month and they pay utilities as well. I rent a room at a friends house for 850 a month. I make 2550 ever two weeks from salary. I have about 7k in liquid money in checking and savings combined which is growing quickly every month. I make 84k a year total income - 32k in total bills, coming to 50-52k a year of money for food, gas, entertainment, shopping, excess money, etc. I am single with no kids. I match 5% into my military retirement plan (Thrift Savings Plan) and have the 5% diversified into two high risk funds (Mostly C fund which is common stocks and a little in I fund which is international stocks). I will keep this house when I move eventually and continue to rent it out and will purchase another home with the VA loan at my new location. I have considered in the meantime getting a second car to Turo due to being in a high tourist location (Destin area), my reasons for this is because I already have a car fully paid off and this allows me to get a nicer car that I can rent out while I use my paid off car for a daily driver but also still enjoy it whenever I want while it pays most of itself off. I have also considered just dumping a ton of money into Traditional or Roth IRA. I have also considered just doing REIT investment. I have also considered getting into the stock market with a robo advisor. I have also considered just doing a high yield savings account. I want to be well off when I am older but I also want to have money when I’m young. I value experiences a lot and love to travel so I want to be able to invest in my future but also make the most out of my youth. I am looking for someone to point me into what my next step should be if they were in my shoes. Thank you! My credit is about 760 by the way. I have Amex Platinum, Amex Gold, Capital One Quicksilver, Citi Custom Cash, Military Star Card, Synchrony Home, my Home Loan, and my Car Loan which just paid off. I only use the amex cards due to the points and the custom cash card for gas for 5% back. I have 200k+ amex points currently. All my cards are paid off in full every month. No debt other than home loan.
Looking for investment advice. I am 27, living in Florida, and am active duty military. I purchased my first home two years ago for 235k. It is now worth 307k at a 3% interest. My mortgage is 1380 a month. I currently am renting it out for 1900 a month and they pay utilities as well. I rent a room at a friends house for 850 a month. I make 2550 ever two weeks from salary. I have about 7k in liquid money in checking and savings combined which is growing quickly every month. I make 84k a year total income - 32k in total bills, coming to 50-52k a year of money for food, gas, entertainment, shopping, excess money, etc. I am single with no kids. I match 5% into my military retirement plan (Thrift Savings Plan) and have the 5% diversified into two high risk funds (Mostly C fund which is common stocks and a little in I fund which is international stocks). I will keep this house when I move eventually and continue to rent it out and will purchase another home with the VA loan at my new location. I have considered in the meantime getting a second car to Turo due to being in a high tourist location (Destin area), my reasons for this is because I already have a car fully paid off and this allows me to get a nicer car that I can rent out while I use my paid off car for a daily driver but also still enjoy it whenever I want while it pays most of itself off. I have also considered just dumping a ton of money into Traditional or Roth IRA. I have also considered just doing REIT investment. I have also considered getting into the stock market with a robo advisor. I have also considered just doing a high yield savings account. I want to be well off when I am older but I also want to have money when I’m young. I value experiences a lot and love to travel so I want to be able to invest in my future but also make the most out of my youth. I am looking for someone to point me into what my next step should be if they were in my shoes. Thank you!
If I look at the bull version (DRN) it shows some of the REIT stocks. It's market cap weighted, and the highest market cap REITs are not what you might expect when you think about Real Estate. Screenshot below. https://preview.redd.it/kxbnlhawel0c1.png?width=1177&format=png&auto=webp&s=ce17305b10e0e38b7cb2214c9f2b833465957567 As you can see the top holdings are things like Industrial, Telecom Towers, Healthcare, Data Center, Self Storage. Nothing in the top holdings are Residential REITs. So using broad Real Estate indexes might not give you what you're looking for. Real Estate is diverse and the most dominant sectors aren't things people talk about much.
Dude, you don’t know how to interpret what you’re reading. Blackrock and Vanguard don’t “own” anything. They are investment firms. They manage their clients assets. Their clients are just normal people who likely have their 401k or IRA housed there. They aren’t snatching up houses for their clients either. Some of their mutual funds invest in real estate investment trusts (REIT). REITs ARE companies that own real estate that pay a dividend back to investors. You invest in a Vanguard fund > you get a share of a REIT > you own a portion of the housing market. Not Vanguard, not Blackrock. Also the portion of homes owned by REITs are very small. Most “corporations” that are snatching up homes are mom and pop investors with an LLC that own one or two homes in addition to their primary residence.
Invewtment funds, yes. Vanguard specifically no. Vanguard is THE Boglehead company. Vanguard only does passive funds. Other than indexer holding AirBnb, and REIT index trackers putting money into all REIT's, it just isnt them.
Only things thats gonna happen with housing is prices stop their exponential growth and things go flat, maybe a small drop based in how demand. What we really need is for legislation that blocks corporations from owning single family homes. Let them have all the commercial, multi-family, and condos they want but no apartments or SFHs otherwise you better have a REIT in your portfolio cuz thats where your rent is going
MPW is a medical REIT. IMO, MPW has been way oversold recently with a string of bad news regarding the finances of two of MPW's large tenants and questions over MPW's ability to refinance/Payoff it's near term debt. The "higher for longer" mantra over fed rates hasn't helped either. I believe MPW has made great strides to address its near term debt and has sold assets to pay it down. It has also reduced its dividend from $1.16/share per year, to $0.60/share per year to pay down debts faster. At the current share price of $4.7, the new dividend has a yield of ~12.7%. Book value according to MPW quarterly filings is around $13/share. As of 10/31, over 133 million shares have been sold short, or around 22% of total shares. I believe one of the leading short sellers has been Viceroy research, founded by Fraser Perring or the self claimed "Grand Poobah of short sellers". Thanks for your time, and if there are any errors in this post, please let me know. As always, before investing, do your own due diligence.
Agreed. I also used to work in shopping mall underwriting for a REIT years ago and most commercial REITS do malls, offices, or both- I’m curious if the WFH trends destroying office space value are attempting to be recouped by landlords through their shopping mall properties in their portfolio, which would become a vicious circle of rent increases causing customer price increases, which will lead to higher rent again since tenants usually have to report their revenue to their landlord by contract, who then uses their increased revenues as an argument for raising rent again
Ok well depends on your horizon, i like to have 75k-100k in chequing acc and another 100k in cash etf Rest i assume if business does not completely fuck up i can invest for 5yr+ i will do index fund + mutual funds If you wanna diy n keep it simple and OK with volatilty then VTI maybe good enough. Add in a REIT if you wanna do a specific RE niche Honestly as a businessowner i dont wanna think too hard aboit investments when i can make so much more in my business if i spend time there
SOME of it should go into Real Estate Investment Trusts (REITs). Enroll them in the Dividend Re--Investment Program (DRIP). The dividends will automatically be reinvested in the shares they come from. When the share's price is down the dividend will by more shares. When the price is up it will buy fewer shares. This will automatically keep the overall cost low. REITs invest directly in properties, earning rental income and management fees. Others invest in real estate debt, i.e., mortgages and mortgage-backed securities. In addition, REITs tend to focus on a specific sector of properties such as retail or shopping centers, hotels and resorts, or healthcare and hospitals. One of the biggest benefits of REITs is their high-yield dividends. REITs are required to pay out 90% of taxable income to shareholders. Most REIT dividends don't meet the IRS definition of "qualified dividends" (tax advantaged). It's just regular income. I am heavily invested in Mortagage REITs. They provide A LOT of income in my ROTH.
>Be careful with REITs. Management, when they need $, issue new shares, causing REIT prices to fall. I dislike REITs. I favor SPY & QQQ, and then sell OTM Calls (with a Delta of about 0.20) to increase the yield. Vanguard ETFs are good IF you don't sell Calls. To get into SPY & QQQ cheap, sell OTM Puts until the stock gets Put to you.
Also people confuse diversification with variety. You can have a whole bunch of investments that are perform the same way. True diversification is de-correlation. Large cap tech growth stock are 99% correlated with each other, so owning different ones is not providing real diversification (though can provide different market returns). With just stocks, the largest spread with the S&P500, which is predominantly large cap growth, is small cap value (at about 65-70% correlation), which is even larger than international funds. I’m not recommending them, but de-correlation can only be further increased by other asset classes like bonds (which can be more correlated with corporate or municipal bonds to the S&P500 than long term bonds or TIPS that shift towards negative correlation), real estate (hard to measure, but can use REIT funds to evaluate de-correlation), or other assets like precious metals (which generally have a neutral correlation to the S&P500). Historically these asset classes will underperform the S&P500, but this would be diversification that isn’t driven by an increased rate of return.
Regarding where to invest: * If you have a 401k at work, contribute enough to that to get the company match. Always choose **Roth 401k** if available. * Max out a **Roth IRA** for this year and 2024. * If you have a (Roth) 401k available, next max that out. (If self-employed, note you can open a solo 401k which is essentially a mega backdoor Roth.) * If you have an HSA available, max *that* out. * Anything left over after the above can go in a taxable account, but keep prioritizing maxing out your Roth IRA and Roth 401k moving forward. As for what to invest in: * In the Roth 401k, a TDF makes fairly good sense. * In the Roth IRA a basket of dividend stocks makes excellent sense, with DRIP enabled. You can also take advantage of investment-grade bonds and equivalents (baby bonds, preferred shares) for easy money while yields are high as they are currently. * Stay away from bond funds, as they are a subpar way to invest in bonds. * Stay away from REIT funds like VNQ, as they underperform individual holdings as well. * SCHD is an acceptable holding for an IRA, again with DRIP enabled, if you don't have the time or inclination to gain enough knowledge for security-picking. * SCHD is a decent holding for the taxable account. Other options could include funds with deferred taxation like QQQX, or low-yield growth funds like VOO.
I know this is several months old but three words - don't do it! That is from a person with currently 30 Yieldstreet projects and a whole lot of worry. I got involved in 2019 and had pretty good success. The returns were a little less than expected but like 9% on what was supposed to be 10 - it seemed good. Then I put a lot more money into investments that were supposed to have quarterly dividends in the start of 2021. Hundreds of thousands of dollars. I've gotten zero dividends from most of them and they claim they are performing when it was very clear that performance was cashflow. I have been insulted and goaded by their account reps who are literally flat out lying and then finally they just sent me restructuring contracts basically reducing my ownership in all of the projects. Two of them actually declared default. I am very concerned about getting my money back. Horrible company. Horrible platform. Oh, as well I invested in both the Prism and the REIT and both have zero return. The NAV in Prism is negative, the NAV in REIT is flat for two year with zero distribution. Meanwhile their marketing is still on Facebook claiming "growth and income" which it's neither. Stay away
WeWork’s losses were same as its revenue more or less every year. My previous employer tried same model and only one site was profitable because it was fully leased to 1company for several years. Its good idea but bad business. Unless it turns to building owner and then its basically same as any other REIT.
I guess I'm just saying make sure your short matches your view. When you short a REIT, you are shorting the properties that REIT owns, not the housing market. Not all parts of the housing market get hit hard so your REITs properties could do OK. Furthermore, REITs don't follow their properties prices, they follow the price people are willing to pay for the REIT. So if your REIT is held by large pension funds who don't trade, the REIT might not even get marked down that much and trade a premium to NAV for a period of time. Similar philosophy with builders.
Sold some energy stock before the energy crisis in Europe for some hyped up REIT shit. Didn't do any DD whatsoever so I overpaid for a micro REIT. Not one year later the REIT was down >60% while the energy company was close to double the price. The crazy thing was that I was already 40% up in one year for that company and it was literally the 1st stock that I ever bought.
I have $10k in Cox income, and another $2k in a money market fund. This will let me ride out rough market conditions for a couple years without having to sell market index funds during a crash. I purchased these bonds after they came down last month. My bi-monthly contributions are split the following way: 40% Vanguard 500 (S&P 500) 20% Vanguard Equity Income-A (Dow Jones Div Stocks) 15% Vanguard REIT (no taxes on these since it's HSA) 25% Vanguard Total Stock Market I currently max out our HSA and never use it for any medical bills.
on a recent Barron's Streetwise Podcast, Jack Hough explained how extremely high yields are like a brightly-colored frog in the jungle: it's a warning sign of danger, not a sign to invest. he discussed another mortgage REIT, and explained the problems of investing in them right now. https://www.barrons.com/podcasts/streetwise/dont-lick-that-frogthe-pull-and-peril-of-a-17-yield/32c95fa6-c098-4239-b238-11e0e411c321?page=1&
It's a mortgage REIT. It actually could have been an interesting discussion if OP actually presented a reasonable thesis other than the yield. These types of investments can provide exposure to interest rate and credit risk via mREITs. For most retail investors, access to mortgaged back securities using mREITs can be more straight-forward. I don't know much about comparing different mREITs and how to contrast the differences. And given the current interest rate environment - mREITS could possibly be an interesting investment opportunity. The high dividend in an mREIT is because REITs are a type or RIC. By law, a RIC is required to pay out 90% or more of their taxable profits to shareholders in the form of dividends.
Put your money into a index fund like VOO. I used to work as a analyst on Wallstreet, today I don't give 2 shits about picking stocks and researching stocks. I put 75% of my money in that index fund and 20% into a REIT. 5% tax free bonds
Put your money into a index fund like VOO. I used to work as a analyst on Wallstreet, today I don't give 2 shits about picking stocks and researching stocks. I put 75% of my money in that index fund and 20% into a REIT. 5% tax free bonds