High Yield Investment

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Category: Investments

High yield bonds are issued by companies whose financial strength is not rock solid. They must pay a higher yield than other safer alternative in order to attract investors. You can buy individual high yield bonds, but most investors would find high yield bond funds to be a more attractive and diversified option. Think of a REIT like a mutual fund that owns real estate. The REIT then passes along the rental income from that real estate to you, the investor. REITs can be publicly traded or private, and may own a broad portfolio of real estate or a narrow one. Through REITS you can invest in apartments, hotels, office space, retail space, healthcare related properties, mortgages, storage and other types of real estate related property.

Technically a preferred stock is an equity investment, but they often get compared to bonds as they are highly interest rate sensitive. Preferred stocks pay dividends at a fixed rate and a company is required to pay dividends to their preferred stock holders before a single penny gets paid out to common stock holders. This feature can make them an attractive source of high yield investment income. Before investing in any type of hyi do your due diligence. Really look at the risks versus rewards, also look at who is managing it. Do they have extensive experience in their field? What is their track record? Is it being recommended by others in their field? Where is it being offered - within the United States or abroad?

High yield mutual funds, bonds, stocks and money markets may not pay out as much as hypes but they are far safer. Here is why: they are usually US based, there are strict rules as to what they say, what they can promise and how they contact you, It is much easier to do your due diligence into both the fund or money market, It is very easy to check the past performance of the money managers, If there have been any disputes with customers, they are usually in the public record. HYIPs on the other hand are usually: highly advertised, located off shore, have very little record of past performance, can put whatever they want about the people running them, promise astronomical returns in a very short time.