Q: MREL is actively managed by "experts in real estate",but has an extremely disapointing performance in my view,I just sold most of my shares in order to reinvest in a new ETF.Is it a good time to invest in a REIT ETF , or do you suggest another sector (materials,finance,etc..) considering the macroeconomics and present global context?
5i Research Answer:
REITs have been a bit of a laggard for the last two years as investors digest a changing landscape betwen work from home trends as well as higher interest rates. A lot of these issues are likely priced in to a large degree at this point, so from more of a contrarian point of view, and a focus on income, we think a case can be made for REITs. Our main caveat here is that it might take markets a bit of time to get comfortable with the outlook for these companies in higer rate environments and it might also take some time to see how commercial real estate adjusts to recent trends, in turn it might be a bit of a waiting game for things to get moving again.