New Year Brings Mortgage REIT Offerings Wednesday, January 5, 1:45 PM ET, by Market News Video Staff Just three trading days into the new year and mortgage REIT investors have already seen ...
By Market News Video Staff, Wednesday, January 5, 1:45 PM ET
Just three trading days into the new year and mortgage REIT investors have already seen two public offerings. On Tuesday, Annaly Capital Management (NYSE:NLY) announced it had raised $1.3 billion through a 75 million share offering and on Wednesday, Hatteras Financial (NYSE:HTS) announced it had raised $287.5 million through a 10 million share offering. While both companies saw their share prices decline following the news, long term investors should be happy as both offerings were accretive to NAV.
Other mortgage REITs include American Capital Agency (NASDAQ:AGNC) which is trading at a 22% premium to the third quarter book value and Chimera Investment Corporation (NYSE:CIM) which is trading at a 23% premium to third quarter book value. Both companies did raise capital in the fourth quarter already.
In the meantime, many investors have been shunning the individual mortgage REITs for ETFs instead. The three month average trading volume for the iShares FTSE NAREIT Mortgage Plus Capped Index Fund (AMEX:REM) is 67,000 shares per day, but a look at the one month average daily volume shows a 45% increase in volume to 97,000 shares per day.
The iShares FTSE NAREIT Mortgage Plus Capped Index Fund has climbed steadily over the past three months, gaining more than 9.4% in the fourth quarter, and gaining more than 16% over the past six months. And with exposure to NLY, HTS, AGNC and CIM, the iShares FTSE NAREIT Mortgage Plus Capped Index Fund portfolio is well rounded. For a complete list of holdings, visit the REM Stock Holdings page on ETFChannel.com
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