In this issue

Jonathan Tobin: Defending the Right to a Jewish State

Heather Hale: Compliment your kids without giving them big heads

Megan Shauri: 10 ways you are ruining your own happiness

Carolyn Bigda: 8 Best Dividend Stocks for 2015

Kiplinger's Personal Finance editors: 7 Things You Didn't Know About Paying Off Student Loans

Samantha Olson: The Crucial Mistake 55% Of Parents Are Making At Their Baby's Bedtime

Densie Well, Ph.D., R.D. Open your eyes to yellow vegetables

The Kosher Gourmet by Megan Gordon With its colorful cache of purples and oranges and reds, COLLARD GREEN SLAW is a marvelous mood booster --- not to mention just downright delish
April 18, 2014

Rabbi Yonason Goldson: Clarifying one of the greatest philosophical conundrums in theology

Caroline B. Glick: The disappearance of US will

Megan Wallgren: 10 things I've learned from my teenagers

Lizette Borreli: Green Tea Boosts Brain Power, May Help Treat Dementia

John Ericson: Trying hard to be 'positive' but never succeeding? Blame Your Brain

The Kosher Gourmet by Julie Rothman Almondy, flourless torta del re (Italian king's cake), has royal roots, is simple to make, . . . but devour it because it's simply delicious

April 14, 2014

Rabbi Dr Naftali Brawer: Passover frees us from the tyranny of time

Greg Crosby: Passing Over Religion

Eric Schulzke: First degree: How America really recovered from a murder epidemic

Georgia Lee: When love is not enough: Teaching your kids about the realities of adult relationships

Cameron Huddleston: Freebies for Your Lawn and Garden

Gordon Pape: How you can tell if your financial adviser is setting you up for potential ruin

Dana Dovey: Up to 500,000 people die each year from hepatitis C-related liver disease. New Treatment Has Over 90% Success Rate

Justin Caba: Eating Watermelon Can Help Control High Blood Pressure

The Kosher Gourmet by Joshua E. London and Lou Marmon Don't dare pass over these Pesach picks for Manischewitz!

April 11, 2014

Rabbi Hillel Goldberg: Silence is much more than golden

Caroline B. Glick: Forgetting freedom at Passover

Susan Swann: How to value a child for who he is, not just what he does

Cameron Huddleston: 7 Financial Tasks You Should Tackle Right Now

Sandra Block and Lisa Gerstner: How to Profit From Your Passion

Susan Scutti: A Simple Blood Test Might Soon Diagnose Cancer

Chris Weller: Have A Slow Metabolism? Let Science Speed It Up For You

The Kosher Gourmet by Diane Rossen Worthington Whitefish Terrine: A French take on gefilte fish

April 9, 2014

Jonathan Tobin: Why Did Kerry Lie About Israeli Blame?

Samuel G. Freedman: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Jessica Ivins: A resolution 70 years later for a father's unsettling legacy of ashes from Dachau

Kim Giles: Asking for help is not weakness

Kathy Kristof and Barbara Hoch Marcus: 7 Great Growth Israeli Stocks

Matthew Mientka: How Beans, Peas, And Chickpeas Cleanse Bad Cholesterol and Lowers Risk of Heart Disease

Sabrina Bachai: 5 At-Home Treatments For Headaches

The Kosher Gourmet by Daniel Neman Have yourself a matzo ball: The secrets bubby never told you and recipes she could have never imagined

April 8, 2014

Lori Nawyn: At Your Wit's End and Back: Finding Peace

Susan B. Garland and Rachel L. Sheedy: Strategies Married Couples Can Use to Boost Benefits

David Muhlbaum: Smart Tax Deductions Non-Itemizers Can Claim

Jill Weisenberger, M.S., R.D.N., C.D.E : Before You Lose Your Mental Edge

Dana Dovey: Coffee Drinkers Rejoice! Your Cup Of Joe Can Prevent Death From Liver Disease

Chris Weller: Electric 'Thinking Cap' Puts Your Brain Power Into High Gear

The Kosher Gourmet by Marlene Parrish A gift of hazelnuts keeps giving --- for a variety of nutty recipes: Entree, side, soup, dessert

April 4, 2014

Rabbi David Gutterman: The Word for Nothing Means Everything

Charles Krauthammer: Kerry's folly, Chapter 3

Amy Peterson: A life of love: How to build lasting relationships with your children

John Ericson: Older Women: Save Your Heart, Prevent Stroke Don't Drink Diet

John Ericson: Why 50 million Americans will still have spring allergies after taking meds

Cameron Huddleston: Best and Worst Buys of April 2014

Stacy Rapacon: Great Mutual Funds for Young Investors

Sarah Boesveld: Teacher keeps promise to mail thousands of former students letters written by their past selves

The Kosher Gourmet by Sharon Thompson Anyone can make a salad, you say. But can they make a great salad? (SECRETS, TESTED TECHNIQUES + 4 RECIPES, INCLUDING DRESSINGS)

April 2, 2014

Paul Greenberg: Death and joy in the spring

Dan Barry: Should South Carolina Jews be forced to maintain this chimney built by Germans serving the Nazis?

Mayra Bitsko: Save me! An alien took over my child's personality

Frank Clayton: Get happy: 20 scientifically proven happiness activities

Susan Scutti: It's Genetic! Obesity and the 'Carb Breakdown' Gene

Lecia Bushak: Why Hand Sanitizer May Actually Harm Your Health

Stacy Rapacon: Great Funds You Can Own for $500 or Less

Cameron Huddleston: 7 Ways to Save on Home Decor

The Kosher Gourmet by Steve Petusevsky Exploring ingredients as edible-stuffed containers (TWO RECIPES + TIPS & TECHINQUES)

Jewish World Review

Practical Investing: Why You Need REITs

By Kathy Kristof

Financial growth from Bigstock

(Kathy Kristof is a Contributing Editor for Kiplinger's Personal Finance)

Kathleen is an investment newbie who has started digging into financial statements to do a better job of analyzing stocks. But she was flummoxed when trying to assess a company that was similar to one I had written about in the May issue. When she sent me the symbol, I understood why. She wasn't looking at an ordinary stock; she was looking at a real estate investment trust.

REITs are something of a hybrid. They trade like stocks, but their dividend yields can approach those of junk bonds. I bought a couple of them in late March-Starwood Property Trust (symbol TWD) and Apollo Commercial Real Estate Finance (ARI)-because I think REITs belong in every diversified portfolio. REITs provide stock market-like returns, but they usually don't move in sync with the market. Thus, holding REITs can add stability to your portfolio without reducing returns. Better yet, REITs are a good hedge against inflation because rents and real estate values tend to climb with rising prices.

But REITs are different from regular companies, and that makes them trickier to analyze. REITs invest in real estate or loans on real estate. Some 90% of REITs own properties, generating most of their income from rents. Moreover, all REITs are required by law to distribute 90% of their earnings to shareholders.


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To be sure you're buying a REIT at a good price, compare its share price to its funds from operations, or FFO. FFO is calculated by adding back depreciation deductions to earnings. Tax law allows a company to write off the value of long-term assets to recognize their diminishing value over time. That's a nice tax break, but it doesn't cost a REIT any cash, nor does it affect the value of a company's assets. And unlike, say, computers, real estate tends to gain, rather than lose, value over time.

You can also compare a REIT's share price to its net asset value (NAV)-that is, the value of all of the properties it owns. Assuming that the assets are valued accurately, buying at a discount to NAV means you're getting a bargain.

But what Kathleen was asking about, and what I hold, are mortgage REITs. Instead of owning properties, these REITs invest in the mortgages on those properties. Lending on commercial property is risky, especially in a dicey economy. But I think it's worth taking a chance on mortgage REITs because I believe the economy is improving and because I am more worried about inflation than a new recession. Mortgage REITs benefit in two ways from an improving economy: Their clients, commercial landlords, collect more rent, improving their creditworthiness. And a rising economy can boost the value of the real estate that serves as collateral.

But even when I gamble, I gamble carefully. So I consider a mortgage REIT's cash flow and asset value, just as I would with a traditional REIT. I also scour recent financial reports for other investment clues.

With Starwood, two things give me comfort. The company projects that earnings will grow 3% to 12% in 2012 based on its existing mortgage portfolio; but it says the projection doesn't account for deals in the works, which could increase revenues by nearly 25%. The company also brags that its borrowers have a lot of equity in the deals, providing a measure of safety.

As for Apollo, the price I paid for the shares ($16.02) represented a slight discount to its NAV, which makes me think I got a relative bargain. Apollo also restructured its debt. That should lower its costs and improve profitability.

I rushed to buy both REITs so that I'd be able to collect the rich dividends. Sure, I knew the price would drop to reflect the payout, but I think investors have a visceral, positive reaction to dividends that tends to buoy the stock. It doesn't make great logical sense. But we are the market and we are not infinitely logical.

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