Bullish Outlook for REITs with VNQ Tailwinds

about 1 month ago

SPEAKER_03

"REITs have underperformed not only because they tend to fall more into the small and mid-cap category, but they can also be sensitive to changes in interest rates. So they've struggled since REITs began to rise in 2022. But now, REITs are likely heading the other way, which could be a tailwind for future REIT returns."

The discussion highlights that although REITs underperformed in recent years due to sensitivity to interest rates and a bias towards small to mid-cap, there is now a reversal in trend expected. The mention of the Vanguard real estate ETF (VNQ) — yielding 3.8% compared to 1.2% for the S&P 500 — adds investor context, suggesting future tailwinds for REITs. This insight provides commentary on a sector-specific trend that sophisticated investors may use to evaluate REIT-related exposure.

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