SPDR Dow Jones REITRWR

Morningstar Rating

ETF Research and Analysis

by Patricia Oey

Suitability

REITs offer investors the ability to invest in a traditionally illiquid asset class--real estate--and receive stocklike returns with bondlike income streams. As many investors know, real estate can serve as a hedge against Read more

Bull Case

In a benign economy, REITs offer investors the potential to receive stocklike returns with bondlike income streams.

This fund holds a number of REIT companies with high quality assets. About 60% of the holdings of this fund have a narrow moat rating.

The dividend yield is more than 4%.

Bear Case

A rise in long-term interest rates would increase REITs' cost of capital, pressure asset values, and reduce cash flow.

REITs tend to be highly leveraged firms, which can be a source of risk, especially in an economic downturn.

REIT correlations with the S&P 500 have steadily increased in the past decade. We question whether REITs will provide meaningful diversification benefits over the longer term. Read more

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The Best ETF Sector Idea for 2010
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SPDR Dow Jones REITRWR

ETF Research and Analysis

Bull Case

Bear Case

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