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| BondsOnline.com: instant access to and extensive coverage of over 3.5 million stocks, bonds, indexes and other securities covering major and emerging markets and exchanges across the globe. |
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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Where to Find 7% Yields |
SmartMoney - Oct. 10, 2011 - By JACK HOUGH
Preferred shares issued by real estate trusts are one of today's few sources of healthy investment income.
Income investors have scant choices as the moment. The 10-year Treasury bond pays just 2.1%, and safe corporate and municipal bonds are similarly stingy. U.S. stocks have dividend yields averaging just over 2%--but they've frightened buyers since summer with breakneck price swings.
Last week I outlined the opportunity in real estate investment trusts, or REITs (see "REITs, Don't Fail Me Now"). These are professionally managed portfolios that turn land into income using all manner of rentable structures: hotels, hospitals, warehouses, apartment buildings and malls, among others. Financing rates are favorable for real estate investors, and in certain commercial markets, demand is strong and supply tight. For investors, REIT yields of 6% and plentiful.
Here's a REIT opportunity I didn't mention in that column: preferred shares. Preferred shares mostly pay fixed dividends instead of variable ones, so they tend not to grow in value over time as rents rise and real estate becomes more valuable. But they also pay more than common shares. REIT preferred shares have yields in the mid-6% to low-8% range now, says Mark Snyderman, manager of the Fidelity Real Estate Income Fund (FRIFX), who generally invests 10% to 15% of his funds assets in preferreds.
REITs often use a combination of bonds and preferred stocks to raise money for their real estate investments. For them, the appeal of preferreds is that there's no maturity date, and thus a lower possibility of a financing crunch if credit markets dry up. Also, for bookkeeping purposes, preferred shares count as equity and not debt, and so help keep leverage ratios conservative.
For investors, the appeal of preferred shares is pretty straightforward. They pay more than bonds, all else held equal.
For the complete article.
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| Stuff to look at |
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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