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Global REIT ETF (REET) Hits New 52-Week High

Sweta Jaiswal, FRM

For investors looking for momentum, iShares Global REIT ETF REET is probably a suitable pick. The fund just hit a 52-week high, up roughly 24.9% from its 52-week low of $22.73/share.

But does it have more gains in store? Let’s take a look at the fund and its near-term outlook to gain an insight into where it might be headed:

REET in Focus

The fund provides exposure to REITs from around the world, which invest in real estate directly and trade like stocks. REET tracks the investment results, before fees and expenses, of FTSE EPRA Nareit Global REITS Net Total Return Index. REET is charging 14 bps in fees. The fund has amassed $1.79 billion in AUM (see all Real Estate ETFs).

Why the Move?

The Federal Reserve has cut interest rate for the second time at the FOMC meeting in September 2019. When interest rate drops, mortgage rates fall, making real estate or refinancing mortgages more affordable. This in turn results in higher real estate sales. Further, Sino-US trade war tensions, uncertainty in market conditions due to geo-political tensions, slowdown in the global economy and Brexit woes are making investors jittery, adding to the lure of these funds. This is because these funds offer outsized yields and act as good investing options when increased safe-haven trade keeps yields at check.

More Gains Ahead?

Currently, given the uncertain market conditions, it is hard to get a handle on the fund’s future returns. However, it seems that REET might remain strong given a positive weighted alpha of 17.20 and a low risk as depicted by a 20-day volatility of 0.5%. Also, many of the segments that make up this ETF have a strong Zacks Industry Rank. As a result, there is definitely some promise for investors who want to ride this surging ETF a little further.

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iShares Global REIT ETF (REET): ETF Research Reports
 
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