AGNC - A REIT (Real Estate Investment Trust) To Invest Into The US Real Estate Market
Current Stock Price: 21,63$
Dividend: 0,18$ per Month (2,16$ per Year = 10% Dividend Yield)
Financing Costs (Leverage) On Etoro: 7,5% per Year
Yearly Index Values Returns Of REITs
The yearly index values returns of REITs show the financial crisis which was caused by falling housing prices in combination with a high FED funds rate so that the US real estate owners could not afford the credit payments any longer. You can find 2 years of negative price developments in the real estate markets across all different kinds of real estates in the US.
(See: https://www.reit.com/investing/index-data/annual-index-values-returns)
US Housing Market Index And Health Status Of US Real Estate Markets
Although housing prices are as high as 2007 before the crisis the real estate owners and new home builders see the outlook for their housing prices bright. The US HMI (Housing Market Index) shows how many real estate owners think that housing prices will continue to rise and that they will get higher prices on their houses in 6 months. Therefore it is also a great early indicator to find out if a similar financial crisis could develop in current overheated markets. You can see in the HMI that already in 2006 / 2007 the HMI dropped significantly below 50 which means that more US citizens think there will be lower real estate prices in the markets in 6 months.
(See: https://www.nahb.org/en/research/housing-economics/housing-indexes/housing-market-index.aspx)
In addition there is currently still a very low FED funds rate and the US citizens have become cautious and are not as much in dept as they were in 2007.
(See. https://fred.stlouisfed.org/series/FEDFUNDS)
The US housing markets are currently in a healthy development and there is no sign of a developing bubble.
AGNC Is One Of The REITs With The Highest Dividend Yield
For this REIT investment I searched within the REITs with the highest dividend yield. AGNC has a yearly dividend yield of 10% and is one of the REITs with the highest yield in that regards.
See: http://www.dividend.com/dividend-stocks/reits-dividend-stocks.php
Financing Costs At Etoro (CFD) And My Wikifolio
However I calculated the financing costs of leverage for the MREIT AGNC which pays you a yearly dividend of 10%. These daily financing costs / rollover costs are too high at 7,5% per year so a leveraged investment does not make sense in my eyes. If you have financing costs of 4% or lower you can take the risks and do a carry trade with a 6% or even higher interest margin with current interest rates and the 10% dividend of AGNC. However if you plan to keep a lot of cash for a longer period of time and you do not care about being invested in the US dollar instead of Euros you can also order shares of AGNC and take the dividend. Analysts see the stock price of AGNC to basically stay the same over the coming year. If you avoid the leveraging / financing costs and you leverage with X1 you can do the trade on AGNC (long of cause) on Etoro with a leverage of X1 and take the yearly dividend of 10%.
In my wikifolio I do not want to be invested with a rate of 100% into stocks at current stock price levels of 2017. Stock markets are overheated and therefore I searched for alternatives and see them currently in the US housing markets with real estate investment trusts (REITs).
You can find my wikifolio which operates at a risk of 0,52x the risk of a Eurostoxx title at: valueformoney
Balance Sheet Analyses
ROE: 22,10%
Equity Ratio: 13,7%
P/B Ratio: 1,1
P/E Ratio: 4,3
Dividend: 0,18$ per Month (2,16$ per Year = 10% Dividend Yield)
Financing Costs (Leverage) On Etoro: 7,5% per Year
Yearly Index Values Returns Of REITs
The yearly index values returns of REITs show the financial crisis which was caused by falling housing prices in combination with a high FED funds rate so that the US real estate owners could not afford the credit payments any longer. You can find 2 years of negative price developments in the real estate markets across all different kinds of real estates in the US.
(See: https://www.reit.com/investing/index-data/annual-index-values-returns)
US Housing Market Index And Health Status Of US Real Estate Markets
Although housing prices are as high as 2007 before the crisis the real estate owners and new home builders see the outlook for their housing prices bright. The US HMI (Housing Market Index) shows how many real estate owners think that housing prices will continue to rise and that they will get higher prices on their houses in 6 months. Therefore it is also a great early indicator to find out if a similar financial crisis could develop in current overheated markets. You can see in the HMI that already in 2006 / 2007 the HMI dropped significantly below 50 which means that more US citizens think there will be lower real estate prices in the markets in 6 months.
(See: https://www.nahb.org/en/research/housing-economics/housing-indexes/housing-market-index.aspx)
In addition there is currently still a very low FED funds rate and the US citizens have become cautious and are not as much in dept as they were in 2007.
(See. https://fred.stlouisfed.org/series/FEDFUNDS)
The US housing markets are currently in a healthy development and there is no sign of a developing bubble.
AGNC Is One Of The REITs With The Highest Dividend Yield
For this REIT investment I searched within the REITs with the highest dividend yield. AGNC has a yearly dividend yield of 10% and is one of the REITs with the highest yield in that regards.
See: http://www.dividend.com/dividend-stocks/reits-dividend-stocks.php
Financing Costs At Etoro (CFD) And My Wikifolio
However I calculated the financing costs of leverage for the MREIT AGNC which pays you a yearly dividend of 10%. These daily financing costs / rollover costs are too high at 7,5% per year so a leveraged investment does not make sense in my eyes. If you have financing costs of 4% or lower you can take the risks and do a carry trade with a 6% or even higher interest margin with current interest rates and the 10% dividend of AGNC. However if you plan to keep a lot of cash for a longer period of time and you do not care about being invested in the US dollar instead of Euros you can also order shares of AGNC and take the dividend. Analysts see the stock price of AGNC to basically stay the same over the coming year. If you avoid the leveraging / financing costs and you leverage with X1 you can do the trade on AGNC (long of cause) on Etoro with a leverage of X1 and take the yearly dividend of 10%.
In my wikifolio I do not want to be invested with a rate of 100% into stocks at current stock price levels of 2017. Stock markets are overheated and therefore I searched for alternatives and see them currently in the US housing markets with real estate investment trusts (REITs).
You can find my wikifolio which operates at a risk of 0,52x the risk of a Eurostoxx title at: valueformoney
Balance Sheet Analyses
ROE: 22,10%
Equity Ratio: 13,7%
P/B Ratio: 1,1
P/E Ratio: 4,3
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