Updated: March 24, 2016
Slowly but surely, investors are once again prioritizing dividends.
After suffering a full-on panic attack over the Fed’s interest rate hike last year—and ditching high-yielding investments like real estate investment trusts (REITs) in the process—they’re having a change of heart.
You can see it in the performance of the Vanguard REIT Index Fund (VNQ), an ETF we’ll examine in more detail below: so far in 2016, VNQ has returned 2% versus just 0.5% for the S&P 500.
Call it a late realization that the rate “liftoff” is mostly a non-event for REITs. Because even if the Fed follows through on its plan to raise rates this year (a big “if” in light of the wavering global economy and cowed US inflation), you’ll still be waiting a very long time for safer vehicles like Treasuries to play in the same league as REITs throwing off yields of 6% or more.…