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why I am NOT selling NLY



August 30, 2013 – Comments (1) | RELATED TICKERS: NLY

OK, I bought NLY probably at the top. Yield was in the mid 'teens. Huzzah! Wait, price has gone down a stomach-churning 25%. Worse, the dividend has been cut. Oops. Clearly a mistake. Am I going to sell?


If I did, I would be making the classic investor mistake: buying high and selling low. The original thesis for this investment is still valid: I want the income stream. The fact that the underlying security fluctuates in value is not relevant, as I have no intention of selling it.

I jiggled the numbers in a spreadsheet, and even with the reduced dividend, I am still making nice, fat 10% return on my original investment amount. This one is a keeper.

1 Comments – Post Your Own

#1) On August 30, 2013 at 7:05 PM, HarryCaraysGhost (60.56) wrote:

I feel the same way about MTGE (which also tanked a bit).

The dividend alone will put the cost-basis in the green within the year.

So even though we overpaid for these REITS,

It's all good.


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