The market is back to its volatile ways, and the action in June really highlights the kind of wild swings traders are capable of producing. As a dividend investor, you may be asking yourself how to find stability for your portfolio amid this churn.

In turbulent stock market environment, smart investors have rightly sought out dividend investments that focus on big dividends and high yields. And one very interesting sector providing those superb yields is agency REITs including Two Harbors Investment Corp. (NYSE: TWO), Capstead Mortgage (NYSE: CMO) and American Capital Agency Corp. (NASDAQ: AGNC).

Unlike traditional REIT dividend stocks that own and operate various types of properties, agency mortgage REITs manage portfolios of debt. Basically, These REITs own Fannie Mae, Ginnie Mae and Freddie Mac paper, which are government backed and AAA rated. But that’s not the real beauty of these dividend trusts.

You see, with QE2 now over, yields on Treasurys have widened from 2.85% on the 10-year back up to around 3.15%. The federal funds rate is likely to remain at 0.25% or lower for the foreseeable future, and that makes the interest rate spread on borrowing short-term cash and investing long in government-backed mortgages a money-making proposition.

I like to say that agency REITs essentially enjoy printing press conditions, because they can take advantage of the interest rate spread with 3x to 9x leverage. This allows them to capitalize on a predictable form of return-on-equity that pays huge dividend yields to investors. The actual return depends on the composition of a specific REIT portfolio (e.g., adjustable versus fixed mortgages), the amount of leverage being utilized and the quality of the mortgages within those portfolios.

So, which agency REITs are worth your attention? Well, there are many good ones, but let’s take a quick look at three of my favorites. The first is Two Harbors Investment Corp. (NYSE: TWO). The company was created at the beginning of 2008 to take advantage of this interest rate distortion that keeps feeding its huge dividend payments.

The mortgage portfolio Two Harbors owns has 77% fixed-rate loans, and 23% adjustable-rate loans. About 80% of the portfolio is government guaranteed, and the remaining 20% is invested in non-guaranteed debt. This makes Two Harbors more of a hybrid agency REIT that takes advantage of opportunities outside the realm of Fannie, Ginnie and Freddie mortgages. Perhaps the best attribute of this agency REIT is that it boasts a current yield of 14.7%.

The second agency REIT I like is Capstead Mortgage (NYSE: CMO). The company invests in a leveraged portfolio of residential mortgage pass-through securities consisting of adjustable-rate mortgage securities issued and guaranteed by government-sponsored enterprises. What appeals to me about Capstead is the adjustable-rate aspect of their portfolio. As rates eventually rise, more exposure to floating rate securities protects principle and keeps dividends on the rise going forward. This agency REIT is currently yielding a very attractive 14.3%.

Another great option in the agency REIT market is American Capital Agency Corp. (NASDAQ: AGNC). Like the other agency REITs, this company funds its investments primarily through short-term borrowing. It then leverages each dollar at about four to five times, purchasing mortgages that pay 4%-6% on average. Borrowing money at 2%-4% and then leveraging it 5-to-1 in 5% instruments produces 20%-25% income. It’s pretty simple math, and as long as short-term rates stay low, and mortgages rates stay above 4%, American Capital Agency can take advantage of that spread and pay out the kind of yield it currently does. Oh, that yield is an astounding 19.2%, making this agency REIT one of the highest yielding investments out there.

So, if your goal is to get maximum yield out of your investment dollars, it’s time to look at agency REITs.

Disclosure: Bryan Perry recommends TWO, CMO and AGNC  in his Cash Machine advisory service.