I actually didn’t know that! But that makes a ton of sense.
Which healthcare REIT is good?
Only has OHI. Actually, many to choose from. The popular ones are HCN, HCP and VTR.
OHI has 7.5% yield. Very good. Maybe after the Senate passes the Obamacare repeal the stock will go even lower and thus push up the yield?
Yes, is a cashflow play.
[quote=“manch, post:63, topic:1760”]
Maybe after the Senate passes the Obamacare repeal the stock will go even lower and thus push up the yield?
[/quote]That would be good, need to buy more.
You can say whatever about WB. He ain’t fool like you or I.
He deals with lots of money, money that you can’t even touch in your entire life.
That means, to get to his level, you take one step at a time, but, remember, he did good and not many achieve their goals.
Ohhhh…the most important opinion from him: He is pro universal health care. In your face! 
Cuz he is old and he is cheap???
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He is rich, but that doesn’t necessarily mean he makes good policy. We have plenty of rich people whose policy you won’t like.
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Since he essentially owns Geico, let’s remind him of his bad policy about maximum number of units exposure on umbrella policies!!! God, that additional Fremont home buy costed me dearly…
Include CCP too ! However, all REIT’s dividends and MLP dividends are not qualified.
They are taxed as income rather than capital gain tax (0% or 15% or 20%).
If you are looking qualified dividends, better to wait for opportunity to grab VZ, T, GILD, QCOM, PFE, JNJ like “dividend aristocrats”.
Keep in IRA 
If keep in taxable account, then for low income tax rate,
Equivalent dividend rate for qualified = Reit’s dividend * (1-your marginal income tax rate)/(1 - 0.15)
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IRA can’t do margins. How about borrowing margin money at 1.5% interests, buy OHI to get 7.5% dividend yield?
Safety of our money is the key.
All Margins, variable rate like ARM, has the risk for original investment. In case of economical crash, we will not be able to hold for years to recover.
Stocks are volatile and sudden change/crash, in a day dow down 1000 points, results auto sell (computer algorithm) that books bigger negative.
Many lost millions during 2001 crash, I remember using margin account ! A friend of mine, during 2000, used stocks (1.6M) as a collateral to buy his Cupertino home ! His company went down from $120 to $2, auto sell happened. I do not the details, but he lost big amount during year 2001 crash.
Margins are worst during crash.
Except temporary 3 days margin, during buy and sell, it is preferable not to use margin account no matter how low rate they give.
Except low interest fixed mortgage for homes, I do not suggest any loans/margins for any investments.
Even in real estate I have seen the impact of variable rate loans.
Look at this home, the very first short sale we failed to buy as my realtor was discouraging me to offer SS. We turned the 950k offer too late after the seller accepted another offer.
The seller was builder who went bankrupt during 2008-2011 as he borrowed ARM kind of loans.
Have a friend that did it with MCA. It’s a tax free ACA muni bond fund. He was getting 6% yield.
AFAIK, lenders require him to protect his shares using either long put or collar. Also, thought is only for short-term loans, didn’t know can use for housing, in that case, thought should need continual proof of protection. May be the rules are different then.
I was renting and lost the job (pink slip) in 2003-4 period.
When the market fell and he lost almost his entire stock net worth, he was regretting that he could have bought his home full cash with the amount of stocks he held. At that time, his home was 1M with 20% down payment. He had even down payment secured with stock collateral which was sold at 200k. He was later happy that bank sold and took 200k worth of stocks. That was his only realized stocks value.
I do not know how it was done at that time.
There was one another friend at Dallas working at I2 technologies, had 5M worth of stock which he did not sell, lost it forever.
Regarding Margin, Ben Graham family was also not left. His mother faced the Margin issue. This is just cut and paste from the preface of Intelligent Investor.
I am well aware of margin’s danger. I have a system that bounds my margin debt based on my net liquidity. If it goes out of bound I will take corrective measure, no question asked. I had a few >20% drawdowns in the last couple years and survived. The discipline is really key to me.
Never say never and I may still blow up, especially if we had something like a one day collapse like 1987. No risk no gain though.
Can’t be applied generically. The statement indicates risk reward relationship. It is subjected to “won’t be blown up by one disaster”.
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I’m currently at 20% margin. Relatively low risk.
@manch, where do you get 1.5% interest on margin loan? I tried IB but it is not 1.5%… more like 2% because it uses tiered rate.
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Jil’s friend(s) did the same as you except he is unlucky and invested in no profit dotcom companies, yours are rock solid money making companies like AAPL. When the tide subsided, he is found swimming naked. I recalled many shares lost 99% of its value. Can’t remember what shares I have (I think I owned Yahoo! and Cisco), but bet whatever remained on AAPLs 
, last hurray 