Equity: Global Real Estate

PRME Top Performer Intra-day
Price $19.59
Today’s Change +0.04%(0.20)
4:00pm 04/21/2017
GRI Bottom Performer Intra-day
Price $44.15
Today’s Change -0.17%(-0.38)
1:59pm 04/21/2017
  • Overview
  • Efficiency
  • Tradability
  • Fit

ETF.com Insight

Fresh competition came to the global real estate segment in 2014. Long-established behemoth RWO still leads in assets, which gives it an unmatched liquidity advantage that makes it theREET charges just a fraction of RWO's fee obvious choice for frequent traders. But long-term investors will want to consider the newcomer, REET, which charges just a fraction of RWO's fee. Both funds hold broad, neutral portfolios with moderate biases toward commercial REITs and the US.
GRI is the most representative global real estate fund, with just a moderate large-cap tilt resulting from its restriction to only 75 companies. It's been around as long as RWO, and has a stable (if modest) asset base, so it likely isn't going anywhere. Still, weak trading, a higher-than-average price tag and mediocre index tracking make it unattractive compared to peers.
GQRE is one of two funds that don't try to track the neutral market. But despite its screens for quality, momentum and value, it doesn't look all that different from our benchmark. The fund gets passing marks for Efficiency and Tradability, so investors that like its "smart beta" methodology should keep it in mind.
The newest fund, SRET, takes radical steps away from neutral in an attempt to boost yield. The fund bets heavily on specialized REITs in the US and Canada, and avoids large-caps all together in its portfolio of just 30 securities. It's worked though—SRET boasts a yield that's leaps and bounds above the competition. Total return is what matters in the long-term though, and SRET hasn't attracted any significant capital to-date. Trade carefully. (Insight updated 04/21/17)

All Funds (7)

RWO $2.74 B 2737986610 best liquidity

A 73
E
91
91
T
93
93
F
73
73

REET $359.35 M 359345100 very low fee

A 70
E
93
93
T
89
89
F
70
70

GRI $75.29 M 75292660 weak trader

B 87
E
92
92
T
56
56
F
87
87

GQRE $207.53 M 207532209.2949 smart beta

C 80
E
78
78
T
73
73
F
80
80

SRET $34.3 M 34301698.247536 new; trade with care

C 43
E
72
72
T
69
69
F
43
43

PRME $993.4 K 993395.23422 growth play; low income

F 64
E
65
65
T
40
40
F
64
64

OLD $5.08 M 5076365.3817 N/A

N/A 0
E
0
-1
T
0
-1
F
0
-1

ETF.com Grade as 04/12/17

Equity: Global Real Estate

1 Year Total Return NAV
Performance  [as of 04/20/17] 1 Month 3 Month YTD 1 Year 3 Years 5 Years 10 Years
Benchmark: Thomson Reuters Global Real Estate3.21%6.63%7.88%7.72%6.02%7.56%--
A 73.452313RWO2737986610RWOSPDR Dow Jones Global Real Estate ETF3.53%3.56%4.00%2.82%6.18%8.10%--
A 70.490152REET359345100REETiShares Global REIT ETF3.74%4.22%4.22%3.38%------
B 87.273795GRI75292660GRICohen & Steers Global Realty Majors ETF3.49%5.04%6.36%3.24%5.80%6.09%--
C 79.986738GQRE207532209.2949GQREFlexShares Global Quality Real Estate Index Fund3.76%4.98%5.43%4.25%7.94%----
C 43.299361SRET34301698.247536SRETGlobal X SuperDividend REIT ETF4.38%6.01%8.23%15.95%------
F 64.258246PRME993395.23422PRMEFirst Trust Heitman Global Prime Real Estate ETF2.52%2.73%1.19%0.08%------
N/A 0OLD5076365.3817OLDThe Long-Term Care ETF7.55%8.40%10.34%--------
All returns over 1 year are annualized. All returns are total returns unless otherwise stated.

ETF.com Efficiency Insight

Two funds stand out in the area of Efficiency. SSgA's RWO is the segment's oldest fund (tied with GRI) and holds the bulk of the segment's assets. While it charges a middlingRWO effectively pays investors to hold it expense ratio, a strong securities lending program has allowed RWO to consistently claw back its entire fee and then some, effectively paying investors to hold it.
iShares' REET does well in Efficiency for different reasons. It's far less established than RWO—it only launched in 2014—and the fund's asset base is small enough to warrant careful monitoring (though we don't currently see any undue closure risk). Despite these concerns, REET's management fee blows its competitors out of the water. We don't yet have enough data to display detailed tracking statistics, but the preliminary results look good—not surprising given the minimal drag created by fund expenses.
GQRE and GRI form a second tier of Efficiency. Both funds are somewhat expensive—comparable to RWO, but without that fund's substantial lending income to offset the costs. Their index tracking results are in line with their fees, with both funds exhibiting a bit more tracking volatility than we'd like to see. Both have mediocre asset bases that are nonetheless sufficient to stave off any significant closure risk. In short, both GQRE and GRI are serviceable investment vehicles, if unremarkable ones.
SRET, launched in early 2015, charges a fee that's marginally higher than its closest competition's. That seems to be inhibiting investor interest—SRET has little more than seed capital—though the fund is still too new to write off as a flop. We'll have full scoring in late 2015. (Insight updated 04/21/17)

All Funds (7)

93
92.741585
92
91.653892
91
90.608529
78
78.195635
72
71.994717
65
65.170198
N/A
0

ETF.com Grade as 04/12/17

Equity: Global Real Estate

Tracking Difference (12 Month)

Ticker Expense Ratio Median Max. Upside Max. Downside Max LT/ST Cap Gains Rate Rule Legal Structure Fund Closure Risk Efficiency
GQRE FlexShares Global Quality Real Estate Index Fund 0.45% -0.05% 0.49% -0.50% 20.00% / 39.60% Low 78.195635
GRI Cohen & Steers Global Realty Majors ETF 0.55% -0.80% -0.50% -0.98% 20.00% / 39.60% Low 91.653892
REET iShares Global REIT ETF 0.14% 0.73% 0.87% 0.56% 20.00% / 39.60% Low 92.741585
RWO SPDR Dow Jones Global Real Estate ETF 0.50% 0.26% 0.30% 0.17% 20.00% / 39.60% Low 90.608529
SRET Global X SuperDividend REIT ETF 0.58% 2.05% 2.43% 1.59% 20.00% / 39.60% Medium 71.994717
PRME First Trust Heitman Global Prime Real Estate ETF 0.95% -- -- -- 20.00% / 39.60% High 65.170198
OLD The Long-Term Care ETF 0.50% -- -- -- 20.00% / 39.60% High 0

ETF.com Tradability Insight

RWO is easily the most popular fund in the segment, and it shows in its better liquidity. There's enough volume here for almost anyone, though average quoted spreads surprisinglyRWO is the more popular fund, and it shows in its better liquidity. aren't minimal. Use careful limit orders, and don't forget to consider trading costs in your P&L math.
GQRE, REET and GRI are all accessible for dedicated long-term investors, but frequent traders should avoid them. Don't put too much faith in the average spread figures quoted here—low volume implies shallow order books that could easily be blown open by even modest trades.
New launch SRET has yet to find its footing, and won't be easy to buy and sell in the meantime. Careful limit orders are a must.
Block trades are a similar story. RWO should be easy to move in large blocks with the assistance of a liquidity provider. The second tier funds should be easy to move too, but expect to pay an extra premium: GQRE's underlying basket isn't very liquid, REET charges a significant creation fee, and GRI's basket mostly trades outside of US trading hours. All of these issues pose an obstacle to market makers, who will pass those costs on.
SRET can be traded in blocks, but not easily. It faces liquidity issues coming and going: the fund's underlying basket isn't very liquid, and APs will have trouble disposing of partial blocks due to poor secondary liquidity in the ETF. (Insight updated 04/21/17)

All Funds (7)

93
93.049669
89
89.020835
73
72.957146
69
69.260892
56
55.642065
40
40.236222
N/A
0

ETF.com Grade as 04/12/17

Equity: Global Real Estate

Ticker Median Daily Volume ($) Average Spread Creation Unit/Day Market Hours Overlap Underlying Volume/Unit % Creation Cost Per Unit (%) Impediment to Creations Score - Tradability
GQRE FlexShares Global Quality Real Estate Index Fund $550.96 K 0.09% 0.19 59.00% 0.34% 0.07% None 72.957146
GRI Cohen & Steers Global Realty Majors ETF $176.14 K 0.44% 0.08 59.00% 0.07% 0.07% None 55.642065
REET iShares Global REIT ETF $2.0 M 0.14% 1.58 73.00% 0.03% 0.21% None 89.020835
RWO SPDR Dow Jones Global Real Estate ETF $13.19 M 0.05% 2.79 68.00% 0.13% 0.06% None 93.049669
SRET Global X SuperDividend REIT ETF $373.63 K 0.18% 0.50 77.00% 0.30% 0.07% None 69.260892
PRME First Trust Heitman Global Prime Real Estate ETF $5.84 K 0.80% 0.00 62.00% 0.14% 0.07% None 40.236222
OLD The Long-Term Care ETF $28.55 K 0.23% 0.01 84.00% 0.97% 0.02% None 0
Spread History
Premium/Discount History

ETF.com/ Block Liquidity

REET
5
4
3
2
1
RWO
5
4
3
2
1
GQRE
5
4
3
2
1
GRI
5
4
3
2
1
PRME
5
4
3
2
1
SRET
5
4
3
2
1
OLD
5
4
3
2
1

This measurement shows how easy it is to trade 25,000 shares of each ETF.

ETF.com Fit Insight

No fund here is broadly representative of the global real estate market, though some come closer than others.
GRI comes closest, despite holding a concentrated portfolio of just 75SRET sports the segment's highest yield by far companies. Like our benchmark, it holds just under half its portfolio in the US, with the bulk invested in commercial REITs and real estate development firms. In this case, winnowing the sector down to so few names means cutting off the bottom end of the market—GRI nearly ignores the small- and micro-caps that make up roughly a quarter of our benchmark, tilting the fund large.
RWO and REET also aim for neutral exposure. Both funds hold more than 200 names, but lean heavily toward commercial REITs at the expense of development companies, and have a bias toward the United States.
GQRE tries to outperform using systematic screens for quality, momentum and value. Despite these screens, it actually looks quite similar to our neutral benchmark on a sector, country and size basis. However, its performance has deviated enough that it's clear other factors are at work here.
SRET will likely sport the segment's lowest Fit score once scoring is available in late 2015. The fund attempts to maximize yield while minimizing volatility, holding just 30 firms in the process. We see a strong bias toward mid- and small-caps in the US and Canada, with a heavy bet on specialized REITs. The strategy seems to be working—in that SRET sports the segment's highest yield by far—but remember that total return is what matters in the long-run. (Insight updated 04/21/17)

All Funds (7)

87
87.273795
80
79.986738
73
73.452313
70
70.490152
64
64.258246
43
43.299361
N/A
0

ETF.com Grade as 04/12/17

Equity: Global Real Estate