Market News for Simon Property Group Inc (SPG)
There are some REITs to avoid in this continued “higher for longer” interest rate environment. These investment vehicles are particularly sensitive to rising interest rates due to their reliance on debt financing. In this economic climate, REITs with high leverage ratios, short-term debt maturities and limited cash flows may struggle to maintain profitability and dividend payouts. Moreover, certain sectors within the REIT universe are more vulnerable than others. For instance, mortgage REITs (mREITs), which invest in mortgage-backed securities, are directly impacted by interest rate fluctuations. Although REITs can be great for income investors and a moderate diversifier in a balanced portfolio, overexposed to this sector can be especially risky, amplified when buying shares of trusts with shaky fundamentals. All of this would be amplified in a stock market crash. So here are three REITs to avoid in May this year. Digital Realty Trust (DLR) Source: Shutterstock Digital Realty Trust (NYSE: DLR ) focuses on data centers and digital infrastructure....
InvestorPlace - 5/2/2024 1:40:38 PM
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