Should You Forget High-Yield AGNC Investment and Buy W.P. Carey Instead?

• AGNC Investment has a immense 13.7% dividend yield.

• W.P. Carey's output is simply a overmuch little 5.5%.

• Although some person dividend cuts successful their histories, 1 is simply a much reliable income stock.

• 10 stocks we similar amended than AGNC Investment Corp. ›

Dividend investors emotion high-yield stocks and tin often get truthful enamored of a output that they place important facts astir an investment. AGNC Investment (NASDAQ: AGNC) is simply a bully illustration of this: Its immense 13.7% output is truthful enticing that galore investors place the information that it is an unreliable dividend payer.

Meanwhile, a dividend chopped astatine W.P. Carey (NYSE: WPC) successful 2023 volition often permission it connected the sidelines contempt an charismatic 5.5% yield. Here's wherefore astir semipermanent income investors volition beryllium amended disconnected with W.P. Carey than AGNC Investment.

If you are similar astir dividend investors, your extremity is to usage the income generated by your portfolio to assistance enactment you during retirement. What you are apt trying to find are stocks that person charismatic yields backed by dividends that person an accidental to turn implicit time. This attack to investing has proved charismatic and palmy for generations.

However, determination are 2 pieces to the equation that you indispensable balance. How overmuch dividend output bash you need, and however overmuch hazard are you consenting to instrumentality on? The biggest hazard is simply a dividend cut, peculiarly if you are utilizing the income you make to screen indispensable surviving expenses. This is wherever AGNC Investment should autumn disconnected astir dividend investors' radar screens.

AGNC Investment is simply a owe existent property concern spot (mREIT). It is simply a reasonably analyzable niche wrong the REIT sector, known for offering highly precocious yields. AGNC's yield, arsenic noted above, is simply a immense 13.7%.

What's backing that output is simply a portfolio of mortgages that person been pooled unneurotic into bond-like securities. There are galore moving parts involved, including lodging marketplace dynamics, owe repayment rates, and involvement rates, among others. In immoderate ways, AGNC is fundamentally managing a portfolio of mortgage-backed securities.

Although the output is huge, dividend investors shouldn't get excessively excited. As the illustration supra highlights, the payout has been highly volatile implicit time, though successful caller years it's been successful 1 absorption -- down. It isn't a atrocious company, per se; it conscionable isn't a peculiarly reliable dividend banal if your extremity is to make a reliable income stream.

The happening is, it is reasonably mean for owe REITs similar AGNC to chopped their dividends. They besides rise them astatine times. However, fluctuating dividends marque budgeting intolerable if you trust connected them to screen your surviving expenses.