ETF Spotlight on the SPDR Dow Jones International Real Estate ETF (NYSEArca: RWX), part of an ongoing series.
Assets: $4.8 billion
Objective: The SPDR Dow Jones International Real Estate ETF tries to reflect the performance of the Dow Jones Global ex-U.S. Select Real Estate Securities Index, which is comprised of international REITs and real estate developers.
Holdings: Top holdings include Mitsui Fudosan Co. 7.1%, Unibail-Rodamco 6.5%, Brookfield Asset Management 5.8%, Westfield Group 4.6% and Land Securities Group PLC 3.2%.
What You Should Know:
- State Street Global Advisors sponsors the fund.
- RWX has a 0.59% expense ratio.
- The ETF has 136 holdings and the top ten make up 38.5% of the overall portfolio.
- Sector allocations include real estate operating company 32.8%, diversified 18.0%, unassigned 14.2%, regional malls 14.0%, office 8.9%, strip centers 4.4%, mixed industrial 4.1%, industrial 1.2%, other retail 1.2%, apartments 0.6%, self-storage 0.3% and healthcare 0.2%.
- Country allocations include Japan 21.9%, U.K. 13.8%, Australia 13.7%, France 9.9%, Hong Kong 9.9%, Canada 9.6%, Singapore 7.7%, Netherlands 2.3%, Switzerland 2.0%, Austria 1.7%, South Africa 1.6%, Philippines 1.6%, Sweden 1.4%, Brazil 0.9%, New Zealand 0.8%, Belgium 0.8%, Thailand 0.5%, and Italy 0.2%.
- RWX has a 4.45% 12-month yield.
- The ETF is up 0.4% over the past month, up 10.5% over the past three months and up 7.8% year-to-date.
- The fund is currently trading 3.3% above its 200-day exponential moving average.
- Real estate investment trusts, or REITs, are required to distribute the majority of their taxable income to shareholders to meet favorable tax requirements.
- “RWX’s relatively small allocation to real estate developers and non-REIT property managers also contributes to the fund’s lower volatility – REITs are restricted from taking on speculative development projects, making their payout ratios higher and cash flows more predictable,” according to Morningstar analyst Abby Woodham.
- Potential investors should be aware that REITs typically underperform in a rising rate envrionment.
Next page: The latest news
The Latest News:
- The stubbornly low rate environment has helped support international REIT ETFs as investors turn to more attractive yield-generating investments. [Low Rates Helping International REIT ETFs]
- Foreign real estate companies are also benefiting from accommodative environments, with Japan and Europe maintaining low interest rates.
- Japan’s real estate market is attracting greater interest from Asian investors seeking to capitalize on the relatively undervalued market, The Korea Bizwire reports.
- “The rise of the real estate market in Japan is caused mainly by the perception of undervaluation of the properties in Tokyo considerably compared with those of Hong Kong, Taiwan and Shanghai,” an official at Mitsui said in the article.
- In the United Kingdom, real estate stocks were weakening following hints that the Bank of England could be curbing the pace of growth in the booming housing market, MarketWatch reports.
SPDR Dow Jones International Real Estate ETF
For past stories in this series, visit our ETF Spotlight category.
Max Chen contributed to this article.