Orchid Island Capital Inc. (ORC)

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EdwardJones Report:"We don't recommend mortgage REITs for individual investors."

What can go wrong?

"• Mortgage REITs borrow more to fund their operations than
equity REITs - Mortgage REITs borrow up to 85% of the fair
market value of assets, while equity REIT levels are usually in
the 25%-50% range.

• Mortgage REITs can be vulnerable to rising interest rates
- Mortgage REIT profits and dividends are typically reduced as
interest rates rise.

• Mortgage REIT dividends have been unpredictable over the
past five years – The five-largest residential mortgage REITs
(by market capitalization) have raised their common dividends
6 times over the last five years, but have also cut their common
dividends on 15 other occasions.

• Most mortgage REITs have consistently issued significant
amounts of new common shares to fund their business
activities - New common stock issuance typically results in
ownership dilution for stockholders."

Read the full report:
https://www.edwardjones.com/images/mortgage-reits-high-yield-but-high-risk.pdf