Professional gamblers will tell you that chasing losses can lead to financial ruin. Basically, chasing losses happens when someone tries to recoup losses quickly by making increasingly larger bets, assuming that "luck" must eventually change. The same theory applies to investing. Sometimes, investors continue to put money into the same stock as it falls, assuming it must eventually rebound. Many never do. Although still dicey, this strategy is better suited to the highest-quality companies, for example, Microsoft (NASDAQ: MSFT). Doing it with the real estate investment trust (REIT) Medical Properties Trust (NYSE: MPW) is perilous.

Medical Properties Trust is hugely popular with retail investors and heavily covered by analysts that cater to this crowd. Part of the allure is its high yield, currently almost 18%. But, as I have written in detail here, dividend growth is often much better for investors than high yields. Stocks often have high yields because they are lower quality or riskier. This causes the stock price to drop, and the market demands a yield much higher than average to own it. As shown below, Medical Properties Trust has lost 75% of investors' money since the beginning of 2022, even when the massive yield is included.

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Source Fool.com