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These FTSE 100 shares yield 6% or above! But are they red-hot buys?

Today I’m considering the investment case of three FTSE 100 (INDEXFTSE: UKX) big yielders.

Walk the line

Shares in Direct Line Insurance Group (LSE: DLG) have shot to five-month highs in recent sessions following a bullish trading update. But I believe the stock still offers plenty of value despite this strength, particularly for dividend chasers.

Direct Line saw gross written premiums leap 3.9% during January-June, to £1.6bn, with premiums at its critical Motor division surging 9.8% in the period. And the company’s Solvency II capital coverage ratio clocked in at a chunky 199% before dividends.

This prompted the insurance play to hike the interim payment to 4.9p per share for the first half, up from 4.6p in the corresponding 2015 period. And Direct Line also splashed out with a 10p special dividend.

The City has chalked in a total dividend of 28p for 2016, yielding a staggering 7.2%. And I reckon dividends should keep growing as market conditions improve in the UK, and Direct Line’s huge brand investment drive keeps on paying off.

Shop around

Things haven’t been as rosy over at Marks & Spencer Group (LSE: MKS), however, and I believe investors should be braced for further troubles as tough retail conditions in the UK look set to endure.

Fashion shoppers continue to leave Marks & Spencer’s clothes on the rail, and like-for-like sales of clothing and homeware items slipped by an eye-watering 8.9% between April and June.

Exploding food sales at ‘Marks and Sparks’ are helping to take the edge off. But the retailer should be braced for moderating demand in the months ahead should Brexit send the economy into a harsh tailspin.

Marks & Spencer’s inability to resurrect its ailing clothing lines must be trying the patience of even the most sympathetic of investors. So while the company is predicted to pay a dividend of 21.3p per share in fiscal 2016 — yielding an exceptional 6.3% — I reckon investors should sit on the sidelines for the time being.

Financial fears

I also believe the UK’s decision to exit the European Union makes insurance giant Aviva (LSE: AV) a risk too far for risk-averse investors.

Investor appetite for the stock leapt following last week’s half-year report that showed operating profit up 13% during January-June, to just over £1.3bn. And stock pickers were encouraged to pile in after the financial play hiked the interim dividend 10% to 7.42p per share.

But I’m concerned that business flows at Aviva could struggle looking ahead as the British economy cools. While the company’s operations sprawl beyond home shores, Aviva still sources half of all business from the UK.

A predicted 23.2p dividend for 2016, yielding a handsome 5.5%, is certainly tempting. But I for one would give Aviva a miss until the full implications of Brexit become clearer.

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Royston Wild has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.