Hatteras Financial Corp. (HTS), American Capital Agency Corp. (AGNC): Is it Time to Buy mREITs?

There is also increasing bullishness surrounding Chimera Investment Corporation (NYSE:CIM), whose portfolio of assets is run by management at Annaly Capital. It should be noted that the same management used to run Crexus Investment, which was brought out by Annaly not too long ago, so there is potential for a takeover here.

Billionaire Leon Cooperman loves Chimera Investment Corporation (NYSE:CIM) and believes the company is set to outperform for the rest of this year. In addition, as it is under the same management as Annaly, Chimera’s portfolio is being positioned in the same manner, with lower durations and less sensitivity to interest rates. Chimera offers a 12% annualized dividend yield, which is paid monthly, unlike the 2 REITs above so investors have less exposure to long term fluctuations in the dividend payout and stock price.

Foolish summary

Overall, it would appear that some of the selling in the mREIT sector is overdone and the downside is now limited. Indeed, most companies are now taking action to restructure their bond portfolios, targeting shorter durations and securities with less sensitivities to interest rates.

All in all, for investors who are willing to take on a bit of risk, with a high dividend payout to mitigate some risk, there could be some opportunities in the high yield mREIT market.

Fool contributor Rupert Hargreaves has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned.

The article Is it Time to Buy mREITs? originally appeared on Fool.com and is written by Rupert Hargreaves.

Rupert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.