One note of caution: most bonds have seen a sharp run-up lately. To make sure you don't overpay, check the net asset value of any fund and compare it to the share price before purchasing. These bonds generally trade near 90% of their face value, but some funds now trade above net asset value.
Canada's strong property market allows these often overlooked REITs to pay generous distributions and healthy yields. Canadian REITs such as Scott's carry yields of up to 11.5% and pay monthly. Yields are high because these REITs, like their U.S. counterparts, pass along their income to shareholders to avoid paying income taxes. (Read my article on "Where You Can Find 11.5% Yields.")
Unlike U.S. real estate, Canada's property market is thriving. Occupancies average 97.4%, according to a June report by credit rating agency DBRS. Moreover, Canadian REITs are taking full advantage of low interest rates (even though they are now rising slightly) to refinance existing debt at historically low rates.
And don't worry about buying Canadian securities. Most U.S. brokers can fill orders on the Toronto Stock Exchange (TSX). Fidelity, E*Trade and Schwab all offer access. Buying Canadian shares can actually be as simple as buying those in the United States. At worst, it might take an extra phone call to your broker to tap into the double-digit yields.Action to Take : The ideas mentioned above are just to get you started. And while the specific securities I mentioned offer high yields, they don't necessarily represent my favorite plays. I typically reserve those for High-Yield Investing and High-Yield International subscribers, but they do offer mouth-watering yields. The main thing to remember is that in a low interest rate world, you don't have to settle for low yields. You just need to do your homework, and get a little creative. This article originally appeared on StreetAuthority. To read more articles from Carla Pasternak on StreetAuthority, you can visit this link. Disclosure: At the time of publication, Carla Pasternak owned no positions in the stocks mentioned.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV