Author Topic: REIT's who uses them?  (Read 9704 times)

Doaner19

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REIT's who uses them?
« on: August 22, 2014, 10:59:54 PM »
I don't know if I really want to be a landlord and deal w/ the headaches that come along.  Looking at REIT's to balance out my portfolio.

Currently I'm all in on equity mutual funds. 

Thoughts? 

NorCal

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Re: REIT's who uses them?
« Reply #1 on: August 22, 2014, 11:38:38 PM »
I have a portion of my portfolio in REIT's.  They are a great source of diversification, and an income generating asset that should appreciate in value over time.

Of course, in this market environment, REIT yields are pretty low.  But that's true of just about all asset classes these days.

I personally own VNQ, which is a broad REIT covering most of the US market.  I also own VNQI which is also broad based, but covers international real estate.

How much you allocate should be determined by your own personal risk tolerance.

Captain and Mrs Slow

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Re: REIT's who uses them?
« Reply #2 on: August 23, 2014, 12:12:49 AM »
this is a great site for Canadian REITS

http://canadianreit.ca/

Frankies Girl

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Re: REIT's who uses them?
« Reply #3 on: August 23, 2014, 12:42:52 AM »
I am holding a portion of:
SPARTAN REAL ESTATE INDEX FID ADV CLASS (FSRVX)

and it's been kicking ass the last year or so. It's returning around the same percentage of gains as my total stock market fund, but it doesn't mirror it.. In any case, I like it.


Roots&Wings

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Re: REIT's who uses them?
« Reply #4 on: August 23, 2014, 05:37:43 AM »
I've owned the Vanguard REIT Index Fund in my Roth IRA for many years (generates a lot of dividends).  Currently it's only a small portion of my overall stash though (less than 5%).

Doaner19

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Re: REIT's who uses them?
« Reply #5 on: August 23, 2014, 10:07:16 AM »
Thx all.

OddOne

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Re: REIT's who uses them?
« Reply #6 on: August 23, 2014, 11:20:44 AM »
Great information! Thanks

Thespoof

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Re: REIT's who uses them?
« Reply #7 on: August 23, 2014, 11:28:58 AM »
I have a REIT ETF in my TFSA. I don't own a house not do I really want to so this makes up my real estate investing.

not_a_trex

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Re: REIT's who uses them?
« Reply #8 on: August 23, 2014, 12:45:25 PM »
What are you hoping to get out of REITs? I'm not criticizing, just genuinely curious. I don't know if you read Josh Collins' blog, but he stepped away from REITs because he concluded that stocks offered the same benefits that a REIT fund could.

http://jlcollinsnh.com/2014/05/27/stocks-part-xxii-stepping-away-from-reits/

Captain and Mrs Slow

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Re: REIT's who uses them?
« Reply #9 on: August 23, 2014, 12:56:45 PM »
I don't really like ETFs for the reit section of my portfolio I own Artis, True North and Dream Global (international REIT) and Aberdeen Asia Pacific, technically not a REIT but I've owned it for a long time and has a great yield.

I got them all when QE crashed the market, all after yields around 8%

Cherry Lane

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Re: REIT's who uses them?
« Reply #10 on: August 24, 2014, 05:07:51 PM »
I've owned the Vanguard REIT Index Fund in my Roth IRA for many years (generates a lot of dividends).  Currently it's only a small portion of my overall stash though (less than 5%).

Just want to highlight part of this, and add a bit:  there are two reasons it is better to have any REITs in your retirement accounts rather than in your taxable accounts. 

The first, stated above, is to avoid tax on the sizable dividends while stash-building. 

The second (which I discovered this year after investing in a REIT in my taxable account) is that in the US the tax forms for the REIT's aren't due from the fund manager on 31 Jan like the other funds, but several months later.  This meant I had to wait an extra month or so from when I otherwise would have filed taxes to file for my refund.

wtjbatman

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Re: REIT's who uses them?
« Reply #11 on: August 24, 2014, 05:17:09 PM »
What are you hoping to get out of REITs? I'm not criticizing, just genuinely curious. I don't know if you read Josh Collins' blog, but he stepped away from REITs because he concluded that stocks offered the same benefits that a REIT fund could.

http://jlcollinsnh.com/2014/05/27/stocks-part-xxii-stepping-away-from-reits/

Diversification. Josh Collins may not invest in them, but they seem to work for a few million other investors (even index investors), so I'll stick with them ;) But not necessarily at the 25% allocation that Collins used to have.

soccerluvof4

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Re: REIT's who uses them?
« Reply #12 on: August 25, 2014, 08:11:39 AM »
+1^ I am in Vanguard Index fund VGSLX which makes up about 10% of my index portfolio.

TreeTired

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Re: REIT's who uses them?
« Reply #13 on: August 25, 2014, 08:33:23 AM »
I have owned NCT for a while and done very well with it.   Longer term chart doesn't look nearly as good as it actually was, because it spun off NRZ, which I also own.    Also own  O  (Realty Income Corp).   

Just part of a diversified income portfolio.

Ottawa

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Re: REIT's who uses them?
« Reply #14 on: August 25, 2014, 08:33:23 AM »
Yup, hold 5% REITs through a BMO ETF: ZRE. 

not_a_trex

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Re: REIT's who uses them?
« Reply #15 on: August 25, 2014, 09:51:42 AM »
What are you hoping to get out of REITs? I'm not criticizing, just genuinely curious. I don't know if you read Josh Collins' blog, but he stepped away from REITs because he concluded that stocks offered the same benefits that a REIT fund could.

http://jlcollinsnh.com/2014/05/27/stocks-part-xxii-stepping-away-from-reits/

Diversification. Josh Collins may not invest in them, but they seem to work for a few million other investors (even index investors), so I'll stick with them ;) But not necessarily at the 25% allocation that Collins used to have.

When you diversify with REITs, do you purchase small REITs or something like VGSLX? I can see diversification if you buy the properties themselves or invest in real estate companies focused in specific areas. Buying something like VGSLX for diversification though doesn't make sense to me. It's a different part of the market than say, VTSAX, but the housing market as a whole seems to perform well and crash similarly to the US stock market.

hodedofome

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Re: REIT's who uses them?
« Reply #16 on: August 25, 2014, 02:06:01 PM »
When you diversify with REITs, do you purchase small REITs or something like VGSLX? I can see diversification if you buy the properties themselves or invest in real estate companies focused in specific areas. Buying something like VGSLX for diversification though doesn't make sense to me. It's a different part of the market than say, VTSAX, but the housing market as a whole seems to perform well and crash similarly to the US stock market.

In the past several years there was increased correlation with all assets (a world-wide financial crisis will do that). However, that was not traditionally so. For a long time the saying was 'real estate does well when stocks don't, and vice-versa.'

Play around with this link http://www.etfreplay.com/correlation.aspx Going back as far as the data will allow, correlation between the US Total Stock Market Index and the US REIT Index for 8/2000-8/22/2014 varied from -0.12 to +.0.94. There is also a definite upside down 'smile' that peaks in 2011 and has been going down ever since. This is consistent with my assumption that correlations grew for all sorts of asset classes but that are now, slowly, going back to historical 'norms.'

Correlations come and go, it remains to be seen how stock and real estate correlations will be in the future.

Thespoof

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Re: REIT's who uses them?
« Reply #17 on: August 25, 2014, 05:24:48 PM »
I don't really like ETFs for the reit section of my portfolio I own Artis, True North and Dream Global (international REIT) and Aberdeen Asia Pacific, technically not a REIT but I've owned it for a long time and has a great yield.

I got them all when QE crashed the market, all after yields around 8%


Boardwalk REIT (TSX: BEI.UN) would have been the big winner though. If investors bought $100,000 of Boardwalk’s shares back in 2004, and reinvested all dividends, the investment would be worth more than $600,000 today. And I wouldn't have had to so much as change a light bulb!

http://www.fool.ca/2014/06/16/forget-buying-a-house-buy-these-reits-and-rent-instead/

not_a_trex

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Re: REIT's who uses them?
« Reply #18 on: August 25, 2014, 07:43:28 PM »
When you diversify with REITs, do you purchase small REITs or something like VGSLX? I can see diversification if you buy the properties themselves or invest in real estate companies focused in specific areas. Buying something like VGSLX for diversification though doesn't make sense to me. It's a different part of the market than say, VTSAX, but the housing market as a whole seems to perform well and crash similarly to the US stock market.

In the past several years there was increased correlation with all assets (a world-wide financial crisis will do that). However, that was not traditionally so. For a long time the saying was 'real estate does well when stocks don't, and vice-versa.'

Play around with this link http://www.etfreplay.com/correlation.aspx Going back as far as the data will allow, correlation between the US Total Stock Market Index and the US REIT Index for 8/2000-8/22/2014 varied from -0.12 to +.0.94. There is also a definite upside down 'smile' that peaks in 2011 and has been going down ever since. This is consistent with my assumption that correlations grew for all sorts of asset classes but that are now, slowly, going back to historical 'norms.'

Correlations come and go, it remains to be seen how stock and real estate correlations will be in the future.

Fair enough

AssetGrinder

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Re: REIT's who uses them?
« Reply #19 on: August 26, 2014, 05:33:11 PM »
Just bought a few Canadian Reits today or about $152,669 worth lol

D.UN
RMM.UN
DRG.UN
CUF.UN
AX.UN
BTB.UN
REI.UN
HR.UN

Average yield 7.57%.

We will see how it pans out

soccerluvof4

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Re: REIT's who uses them?
« Reply #20 on: August 29, 2014, 09:27:10 AM »
Do some research on ARCP

fmzip

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TomTX

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Re: REIT's who uses them?
« Reply #22 on: September 02, 2014, 06:06:31 AM »
Just bought a few Canadian Reits today or about $152,669 worth lol

D.UN
RMM.UN
DRG.UN
CUF.UN
AX.UN
BTB.UN
REI.UN
HR.UN

Average yield 7.57%.

We will see how it pans out

And you bought them on margin. To me, that says speculator/gambler territory.

Franklin

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Re: REIT's who uses them?
« Reply #23 on: September 02, 2014, 06:41:37 AM »
I am holding a portion of:
SPARTAN REAL ESTATE INDEX FID ADV CLASS (FSRVX)

and it's been kicking ass the last year or so. It's returning around the same percentage of gains as my total stock market fund, but it doesn't mirror it.. In any case, I like it.

+1.  Been a good year.  I generally maintain 10%.

Stasher

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Re: REIT's who uses them?
« Reply #24 on: September 02, 2014, 09:33:04 AM »
Yup, hold 5% REITs through a BMO ETF: ZRE.
Same one for me and pays a nice dividend too, I hold mine within my Scotia iTrade RRSP account . Only difference for me is it is  about 20% of my holdings.

pdxvandal

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Re: REIT's who uses them?
« Reply #25 on: September 02, 2014, 10:12:10 PM »
I own VGSLX. It's about 8-9% of my portfolio, down from about 15% last month. Great returns YTD.

birdman2003

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Re: REIT's who uses them?
« Reply #26 on: September 10, 2014, 01:28:46 PM »
I buy O on a monthly basis without paying brokerage commissions.  Their website (http://www.realtyincome.com/) links to a wells fargo site (share owner or something) that you can use to buy shares of O on a monthly basis.  They pay the account fees, so it's pretty simple to acquire equity in a REIT without having to pay brokerage commissions.

RootofGood

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Re: REIT's who uses them?
« Reply #27 on: September 10, 2014, 02:41:03 PM »
I use REITs to balance out my asset allocation.  6% in US REIT index fund (VNQ and VGSNX).  5% in international REITs (VNQI and WPS).

They are supposed to be somewhat loosely correlated with the major equity indexes. 

thedayisbrave

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Re: REIT's who uses them?
« Reply #28 on: September 10, 2014, 07:49:12 PM »
I have 5.5% of my portfolio is VGSLX (Vanguard Domestic REIT).  I hold physical real estate too.  My thinking is, my real estate is super local (and residential).  So this is giving me broader US exposure in commercial (where I'm lacking).  It's working out well so far.  I'll probably always hold REITs regardless of what my real estate investments look like.  To me, just because they're both labeled "real estate" doesn't mean they are alike at all.