AGNC Investment has a higher-risk business model. It invests in Agency mortgage-backed securities (MBS; pools of residential mortgages guaranteed against credit losses by government agencies such as Fannie Mae) on a leveraged basis. Using leverage boosts returns (currently 13% to 15%, compared to the low single digits for MBS). As long as its returns are above its costs, the REIT can maintain its dividend.

That's currently the case. During the fourth quarter, the company's total cost of capital was 15.8% when accounting for its operating expenses and dividend payments. With its return on equity at 16% in the quarter, AGNC's dividend remained well-aligned with its cost of capital. The company believes it can continue to generate favorable returns in the current environment, which bodes well for its ability to maintain its dividend level.

However, if the market environment for Agency MBS deteriorates significantly and its returns fall out of alignment with its costs, the REIT might need to reset its dividend gain. Even if AGNC cut its dividend, investors would likely still be able to generate significant dividend income over the next five years.

The potential to collect lots of dividend income

AGNC Investment offers investors the opportunity to collect a massive amount of dividend income. A $5,000 investment could generate over $3,500 of income over the next five years if the REIT maintains its dividend. While its big-time payout is at greater risk of a reduction, the REIT should still generate plenty of income even if it needs to trim its payment again.