Mortgage REITs Continue to Lead REIT Market’s Performance

Mortgage REITs continued to lead the U.S. REIT market’s performance through the first eight months of 2017. The FTSE NAREIT Mortgage REITs Index delivered an 18.27 percent total return for the year through August, compared to a 6.89 percent gain for the FTSE NAREIT All Equity REITs Index and 11.93 percent for the S&P 500.

Home Financing Mortgage REITs drove the performance of the Mortgage REIT market, delivering a 22.09 percent total return in the first eight months of the year, compared with a 6.52 percent total return for Commercial Financing REITs.

Mortgage REITs also provided the strongest dividend yields. The dividend yield of the FTSE NAREIT Mortgage REITs Index on August 31 was 9.59 percent, with Home Financing REITs yielding 10.08 percent and Commercial Financing REITs yielding 7.89 percent. In comparison, the dividend yield of the FTSE NAREIT All Equity REITs Index on August 31 was 3.78 percent, and the dividend yield of the S&P 500 was 2.00 percent.

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