Friday, March 31, 2006

REITs

REIT (Real Estate Investment Trust) - A company that purchases and/or manages real estate properties, using money invested by its shareholders and typically pay back 90% in dividends.

Some REITs are paying back around 20%+ in the form of dividends and are doing very well. I see strong growth in the economy for at least the short term and I don't expect the "housing bubble" will have much effect oin it right now.

The only disadvantage to REITs is you are fully taxed on the capital gains as opposed to the 15% that you would usually get taxed on for stocks that are held for at least 1 year.

I am currently screening REITs for >= 4% dividend yield, >= 5% dividend growth and >= hold recommendations by analysts. TMA has caught my eye right now.

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