While REITs and their related ETFs make regular payouts, investors need to remember that they are still more volatile than bonds and should be part of an equities allocation within an investment portfolio.
Nevertheless, REITs still provide another layer of diversification to any portfolio, since the assets show a lesser correlation to the overall stock market. Additionally, REIT ETFs provide investors with a broad, diversified mix of REITs, which helps investors avoid picking out the wrong REIT security. [Real Estate: List of REIT ETFs]
Potential REITs ETF investments to take a look at include:
- ALPS ETF Trust Cohen & Steers Global Realty Majors ETF (NYSEArca: GRI)
- First Trust S&P REIT Index Fund (NYSEArca: FRI)
- Focus Morningstar Real Estate Index ETF (NYSEArca: FRL)
- Index IQ US Real Estate Small Cap ETF (NYSEArca: ROOF)
- iShares FTSE EPRA/NAREIT Europe Index Fund (NYSEArca: IFEU)
- iShares FTSE EPRA/NAREIT North America Index Fund (NYSEArca: IFNA)
- iShares FTSE EPRA/NAREIT Global Real Estate ex-U.S. Index Fund (NYSEArca: IFGL)
- iShares FTSE NAREIT Real Estate 50 Index Fund (NYSEArca: FTY)
- iShares FTSE NAREIT Mortgage PLUS Capped Index Fund (NYSEArca: REM)
- iShares FTSE NAREIT Residential PLUS Capped Index Fund (NYSEArca: REZ)
- iShares FTSE NAREIT Industrial/Office Capped Index Fund (NYSEArca: FNIQ)
- iShares FTSE NAREIT Retail Capped Index Fund (NYSEArca: RTL)
- iShares S&P Developed ex-U.S. Property Index Fund (NYSEArca: WPS)
- iShares Trust Dow Jones U.S. Real Estate Index Fund (NYSEArca: IYR)
- iShares Trust Cohen & Steers Realty Majors Index Fund (NYSEArca: ICF)
- Market Vectors Mortgage REIT Income ETF (NYSEArca: MORT)
- PowerShares Active U.S. Real Estate Fund (NYSEArca: PSR)
- PowerShares KBW Premium Yield Equity REIT Portfolio (NYSEArca: KBWY)
- Schwab U.S. REIT ETF (NYSEArca: SCHH)
- SPDR Dow Jones REIT ETF (NYSEArca: RWR)
- Vanguard REIT ETF (NYSEArca: VNQ)
- Wilshire US REIT ETF (NYSEArca: WREI)
For more information on real estate investment trusts, visit our REITs category.
Max Chen contributed to this article.