Mortgage real estate investment trusts (mREITs) are investment vehicles that focus on generating income through mortgage-related assets, such as mortgage-backed securities and mortgage loans.
Unlike traditional REITs that invest directly in real estate, mortgage REITs earn income from the interest on mortgage assets, offering investors exposure to the mortgage market with the potential for high dividend yields.
Here are the three mortgage REITs with the highest yields.
Orchid Island Capital Inc.
As a specialty finance company that invests in residential mortgage-backed securities (RMBS), Orchid Island Capital Inc. (NYSE:ORC) has the highest dividend yield at 21.04%. The company’s investment strategy focuses on the acquisition and management of government-backed RMBS, aiming to generate attractive risk-adjusted returns for investors.
NexPoint Real Estate Finance Inc.
NexPoint Real Estate Finance Inc. (NYSE:NREF) has a current yield of 17.29%. The company focuses on originating, structuring and investing in first mortgage loans and mortgage-backed securities. Its strategy is centered on providing structured financing solutions to property owners across various sectors, including multifamily, office and hospitality. Its objective is to deliver stable, risk-adjusted returns to investors.
Invesco Mortgage Capital Inc.
​​Invesco Mortgage Capital Inc. (NYSE:IVR) has a current yield of 17.02% with an investment portfolio including a diverse range of assets like government agency RMBS, nonagency RMBS, commercial mortgage-backed securities (CMBS) and residential and commercial loans. Its overarching strategy is designed to provide sustainable income and capital appreciation for its investors.
Remember, these are the mortgage REITs with the highest yields. That doesn’t necessarily make them the best for you.
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