This REITs Dividend Grows on Trees

During a month when REITs outperformed the S&P 500 and generally had a solid return, two property sectors were noticeably absent at the party. In a way, it reminds me of my high school days when to my dismay, I would find out Monday morning that all the cool kids were at a party together over the weekend and I wasn’t invited. In the REIT world, the uninvited were Lodging REITs, which have continued their downtrend YTD with another 0.7% decline for the month and is now -10.8% for 2015. Meanwhile, Timber REITs have also struggled so far in 2015 and July was no exception, as they declined another 1.8% for the month.

Despite the decline, however, this REIT has increased its dividend by 94% in just a few short years.

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REITs Are Oversold: It Seems To Be a Good Time to Be Greedy While Others are Fearful

Gekko, greed is good

Greed is good. Some of you might remember the phrase being said by Gordon Gekko, the Wall Street villain played by Michael Douglas in the 1987 film, “Wall Street.” The actual phrase was much longer:

Greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures, the essence of the evolutionary spirit. Greed, in all of its forms; greed for life, for money, for love, knowledge, has marked the upward surge of mankind and greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the U.S.A.

Warren Buffett, another well-known, but less fictional character has another quote along those lines:

Be fearful when others are greedy and greedy when others are fearful.

Investors have been fearful of interest rate rises and have dumped REITs. We think it’s a good time to be greedy.

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