Tag Archives: Reits

REITs: A Rare Bright Spot in an Otherwise Difficult Year for Canadian Equities

Despite weak Canadian equity market returns this year, REITs have continued their long-term outperformance. The benchmark S&P/TSX Composite has fallen 8.5% on a total return basis through Dec. 18, 2018, while the S&P/TSX Capped REIT continues to be a bright spot, gaining 8.8% over the same period—a difference of over 17%. Market analysts tend to Read more […]

Indexing Canadian REITs: A Look at the S&P/TSX Capped REIT Income Index

In a previous blog post, Evolution of Canadian REITs, we outlined the evolution of the Canadian REITs market. In this post, we will explore in detail the S&P/TSX Capped REIT Income Index, which is designed to serve as an income-producing strategy. The index seeks to measure the performance of REIT companies in the S&P/TSX Composite, Read more […]

Evolution of Canadian REITS

The Canadian REITs industry will mark its 25th anniversary in June 2018. In light of this milestone event, it is worthwhile to review the evolution of the market as well as the characteristics of the asset class. Canadian REITs were born after the recessionary period in the late 1980s and early 1990s. There were five Read more […]

Considering REIT Lease Durations in a Rising Rate Environment

U.S. REITS have been lagging broad U.S. equities. During the recent climb in 10-year Treasury yields from the 2018 low of 2.41% on January 2, to as high as 2.94% on February 21, the Dow Jones U.S. Select REIT Index declined 11.2%. Though we have found that REITS have generally fared well over full cycles Read more […]

A long time coming: Real estate moves out from under the shadow of financials – Part 2

Interest rates have influenced the performance of REITs relative to bank shares Interest rates have a strong influence on equity REIT performance, as evidenced by the graphic below, which displays the relationship between the 10-year Treasury yield and the relative performance of the S&P 500 Banks Index to the S&P 500 Real Estate Investment Trusts Read more […]

A long time coming: Real estate moves out from under the shadow of financials – Part 1

Real estate’s new sector status uncovers key differences between REITs and financial stocks As of Sept. 1, S&P and MSCI have established real estate as the 11th sector within the Global Industry Classification Standard (GICS) by separating it from the financials sector. Under this arrangement, real estate investment trusts (REITs) are now classified as follows: Read more […]

Inside the S&P 500: The Real Estate Sector

Part of the power of the S&P 500 is analyzing the market and gaining insights into which stocks rising or falling.  The key to these analyses is GICS – the Global Industry Classification Standard – which is used to define the sectors and industries in the index. GICS is jointly maintained by S&P Dow Jones Read more […]

Considerations for a Global Approach to Property Investing

While U.S. REITs have garnered a lot of attention in recent years and become quite a popular investment category, comparatively little attention has been paid to real estate securities based outside of the U.S., despite significant development in international markets.  In February 1995, just three markets—Australia, the Netherlands, and the U.S.—were represented in the S&P Read more […]

These Assets Mix With Oil Like Water

While many assets have some relationship with oil, there are varying degrees of correlation and even a few surprises. For example, Canadian equities are more correlated with oil than are the emerging markets and the US equities; Australian equities are barely correlated with oil, and China who is not nearly as big a producer as a consumer is moderately Read more […]

Real Estate Rising and GICS

Real estate, once the villain of the financial crisis, is now lauded as the place to find yield, diversification and maybe stability.  Before REITs became eligible for the S&P 500 in October 2001, real estate investing either meant direct ownership or a specialized corner of the stock market.   The recovery from the financial crisis focused Read more […]