Adamas Trust, Inc. provides investors with a compelling income opportunity through its ADAMM series preferred shares, which currently offer a 10.8% annualized dividend yield. These preferreds stand out among the company’s nine income instruments, which include four preferred issues and four baby bonds. Over the past year, net interest income has increased by 7%, supported by disciplined portfolio expansion into both agency and non–agency residential mortgage–backed securities. While preferred shareholders benefit from a fixed quarterly payout and seniority over common equity, rising benchmark rates could amplify leverage and challenge the trust’s liquidity profile. Investors should weigh the high yield against potential balance sheet pressure if funding costs continue to climb.

Adamas Trust recently completed an initial public offering of its ADAMO senior note, carrying a coupon of 9.25% and maturing in 2031, with a yield to maturity near 9.5%. The note’s credit spread over Treasuries is approximately 50 basis points tighter than the spread observed six months ago on its ADAMH issue, reflecting improved market confidence and favorable execution by lead underwriters. ADAMO represents the longest–dated debt instrument in the mortgage REIT’s funding stack, aligning in pricing with peer issuances rather than suggesting distress pricing. Proceeds will be used to extend debt maturities and enhance flexibility for future portfolio growth, but investors should monitor leverage metrics, which currently sit near 8.5x net debt to equity.