Could Buying Realty Income Stock Today Set You Up for Life?
The S&P 500 index (SNPINDEX: ^GSPC) offers a miserly 1.2% yield. Real estate investment trusts (REITs) can get you 3.8%, three times higher. And you can still do better if you buy Realty Income (NYSE: O) and its 5.8% dividend yield today. Here's why even conservative investors will like this high-yield and highly reliable net lease REIT.Realty Income is a net lease REIT. That means most of its properties are single-tenant, which leads to a high level of risk on any individual property. But the tenant is responsible for most property-level operating costs, which reduces risk because Realty Income isn't exposed to the expense and work of maintaining the asset. Realty Income also is huge, with more than 15,400 properties. So what property-level risk there is ends up being mitigated by the size and diversification of its portfolio. All in, this REIT has a fairly low-risk business model.Image source: Getty Images.Continue reading
The S&P 500 index (SNPINDEX: ^GSPC) offers a miserly 1.2% yield. Real estate investment trusts (REITs) can get you 3.8%, three times higher. And you can still do better if you buy Realty Income (NYSE: O) and its 5.8% dividend yield today. Here's why even conservative investors will like this high-yield and highly reliable net lease REIT.
Realty Income is a net lease REIT. That means most of its properties are single-tenant, which leads to a high level of risk on any individual property. But the tenant is responsible for most property-level operating costs, which reduces risk because Realty Income isn't exposed to the expense and work of maintaining the asset. Realty Income also is huge, with more than 15,400 properties. So what property-level risk there is ends up being mitigated by the size and diversification of its portfolio. All in, this REIT has a fairly low-risk business model.
Image source: Getty Images.
