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FlexShares Could Launch Quality REIT ETF


FlexShares, the ETF unit of Northern Trust (NTRS), has filed plans with the Securities and Exchange Commission to possibly introduce the FlexShares Global Quality Real Estate Fund. In what is becoming a growing trend in the ETF industry, the new ETF, if it comes to market, will track an in-house index.

That index is the Northern Trust Global Quality Real Estate Index, a fundamentally-weighted index that focuses on commercial and residential REITs. Mortgage REITs, real estate finance companies, mortgage brokers and bankers, commercial and residential real estate brokers and real estate agents and home builders are among the securities that are excluded from the index, according to the filing. 

The index is comprised of securities from markets in the following countries: Australia, Austria, Belgium, Canada, China, Finland, France, Germany, Greece, Hong Kong, Israel, Italy, Japan, Luxembourg, Netherlands, New Zealand, Norway, Singapore, Sweden, Switzerland, United Kingdom and United States, according to the FlexShares filing. The filing does not include a ticker or expense ratio, indicating a launch date for the global REIT ETF is not imminent.

In July, FlexShares filed plans with the SEC for the FlexShares Global Infrastructure Fund. FlexShares has already introduced three ETFs this year, including the FlexShares International Quality Dividend Dynamic Index Fund (IQDY). [FlexShares Could Introduce International Infrastructure ETF]

The issuer currently has just 13 ETFs on the market, but many quickly gained traction with investors. FlexShares has nearly $6 billion in ETF assets under management, making it the 15th-largest U.S. issuer. The largest FlexShares ETF is the FlexShares Morningstar Global Upstream Natural Resources Index ETF (GUNR) , which has nearly $2.6 billion in assets.

Other FlexShares ETFs that have proven popular with investors include the FlexShares Morningstar Emerging Markets Factor Tilt Index ETF (TLTE) with $124.4 million in AUM and the FlexShares Quality Dividend Index Fund (QDF) . QDF debuted in late 2012 and already has $150.5 million in AUM.

FlexShares Morningstar Emerging Markets Factor Tilt Index ETF

ETF Trends editorial team contributed to this post.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.