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Real Estate Investment Trust (REIT)
Term category: Stocks
In 10 words or less: A company that invests in real estate and pays an extremely high dividend as a result.

Definition: A security that trades as a stock on the stock exchange, but invests in real estate and/or mortgages.

StockJargon Advice: REIT's are special trusts that receive tax advantages from the government. They're obligated to pay out 90% or more of their earnings to investors in the form of dividends so it's not unusual to see a REIT with a 10-12% dividend.

An equity REIT invests in and owns various real estate properties. Their revenues come from people renting places in those buildings.

A mortgage REIT invests in mortgages on real estate. Their revenues come from the interest paid on the mortgages.

Related Articles

REIT Investing
Real estate investing can prove to be a profitable way to invest…

Wikipedia: REIT
A page on Wikipedia explaining REIT's…

REIT's Explained
A very informative page that explains REIT's and the different types...

Related Books

Investing in REITs by Ralph Block
REITs by John A. Mullaney
The Millionaire Real Estate Investor by Gary Keller
Wall Street Journal Guide to Understanding Money and Investments by Kenneth M. Morris

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