With 10-year Treasury yields tumbling this year, real estate investment trusts (REITs) and the releveant exchange traded funds have once again been a premier destination for income investors.
Only four ETFs have gained more assets than the $3.7 billion added by the Vanguard REIT ETF (NYSEArca: VNQ). Inflows to the iShares U.S. Real Estate ETF (NYSEArca: IYR) and the SPDR Dow Jones REIT ETF (NYSEArca: RWR) are nothing to scoff at either, checking in at about $1.1 billion combined. [REIT ETFs Enjoying Solid Fundamentals]
International REIT ETFs are also gaining favor with investors and the SPDR Dow Jones International Real Estate ETF (NYSEArca: RWX) is helping to lead that charge.
No property ETF attracted more than the $304 million allocated to RWX last month as those new inflows sent the ETF’s shares outstanding total to a record, reports Hui-yong Yu for Bloomberg.
With property values looking frothy in the U.S., some investors are looking to international markets for more compelling values. Despite the absence of large discounts compared to some U.S. markets, property investors enjoy the familiarity and easy-to-navigate legal structures in developed markets, such as Australia and the U.K., according to Bloomberg.
Those markets combine for nearly 28% of RWX’s weight, an important consideration when acknowledging international REITs are as sensitive to interest rate changes as their U.S. counterparts. There is some encouraging news on the interest rate front for RWX.