New “High Yield” Program Added
“I Prefer Income” added the new High Yield Program. It includes these 3 asset classes:
- Mortgage REITS
- Commercial REITS
- BDC (Business Development Companies)
Mortgage REITs (mREITS) provide financing for income-producing real estate by purchasing or originating mortgages and mortgage-backed securities (MBS) and earning income from the interest on these investments. mREITs hold mortgages and MBS on their balance sheets and fund these investments with equity and debt capital. The general focus is on residential mortgage real estate and their general objective is to earn a profit from their net interest margin, or the spread between interest income on their mortgage assets and their funding costs. mREITs rely on a variety of funding sources, including common and preferred equity, repurchase agreements, structured financing, convertible and long-term debt and other credit facilities.
“I Prefer Income” maintains and tracks 23 mortgage REITs with an average yield of 10%.
Commercial REITs focus their business on the commercial side of real estate. They are the same as mortgage REITs except that they provide financing for commercial real estate by purchasing or originating mortgages on commercial real estate. cREITs generally have higher yields than equity REITs, but less than mREITs.
“I Prefer Income” maintains and tracks 17 commercial REITs with an average yield of 7.17%.
BDC (Business Development Companies)
A business development company (BDC) is an organization that invests in small- and medium-sized companies as well as distressed companies. A BDC helps the small- and medium-sized firms grow in the initial stages of their development. With distressed businesses, the BDC helps the companies regain sound financial footing.
To qualify as a BDC, a company must be registered in compliance with Section 54 of the Investment Company Act of 1940. It must be a domestic company whose class of securities is registered with the Securities and Exchange Commission (SEC). The BDC must invest at least 70% of its assets in private or public U.S. firms with market values of less than US$250 million. These companies are often young businesses, seeking financing, or firms that are suffering or emerging from financial difficulties.
“I Prefer Income” maintains and tracks 40 BDCs with an average yield of 9.3%.
Many of these high yield stocks will be of interest to Immediate Income investors; but remember that they are higher yield for a reason. However, if you take the time to research them, you may find some of them to be a good fit for you. I do not feel that any are a buy and hold stock; however, if you are an active investor who will keep you eye on them, then they could provide a zip to your portfolio.
I hope you find that the new High Yield program to be a good addition to the I Prefer Income programs that include: Preferred Stocks / ETD securities, Equity REITs, MLP / Midstream stocks and Dividend Diamonds 25+. Remember that the “I Prefer Income” programs are FREE and available to anyone that is interested in “relying on yourself investing”. Just go to here to register.
I Prefer Income!