Historical data shows that a consistent $500 monthly investment into Ready Capital Corporation 5.75% (RCC) starting in 2020 would have turned a total investment of $40K into $49K today. This represents a total return of 22.8% over the 6-year period, compounding through dividend reinvestment and market growth.
The Impact of Dividend Reinvestment (DRIP)
Ready Capital Corporation 5.75% pays a dividend (currently yielding ~0.05%). By utilizing a Dividend Reinvestment Plan (DRIP), generated dividends automatically purchase fractional shares. Over this 6-year period, regular dividend payments totaled $8K. Reinvesting these dividends continuously compounded your returns, accelerating the portfolio's growth far beyond simple price appreciation.
RCC vs. S&P 500 (SPY) Benchmark
When comparing this dollar cost averaging strategy against a broad market index,RCC underperformed the S&P 500 ETF (SPY). The same $500 monthly contributions into SPY would have grown to $65K, compared to RCC's $49K.