Should you worry about your investment in WMC?

Why do we invest in Real Estate Investment Trusts? For some the answer is immediate income. This is where the mortgage REITS come into focus. A mortgage REIT is like any other REIT. It is a corporation, trust or association that acts as an investment agent specializing in real estate and real estate mortgages under Internal Revenue Code section 856. The advantage of being a REIT is that the company is entitled to deduct dividends paid to its owners, and thus a REIT may avoid incurring all or part of its liabilities for U.S. federal income tax. To meet the qualifications, REITs are required to distribute 90% of earnings to shareholders. My favorite mREITS that I have covered thoroughly in the past are American Capital Agency (NASDAQ:AGNC) and Annaly Capital Management (NYSE:NLY) and they have been crushed. My top choice in the space is New York Mortgage Trust (NASDAQ:NYMT) for its outperformance in the sector over the last few years versus its brethren. However, there is one stock that I hold a position in that I have not written about in detail in some time that I keep being asked about. That stock is Western Asset Mortgage (NYSE:WMC) and this article is.....READ MORE