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iShares Global Real Estate Index ETF (CGR $31.75)
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iShares S&P/TSX Capped REIT Index ETF (XRE $16.36)
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Hamilton REITs YIELD MAXIMIZER TM ETF (RMAX $16.57)
Q: What do you think of RMAX ? Are there other real estate funds that look interesting ? How about international real estate opportunities. Please provide some of your picks.
5i Research Answer:
RMAX is an equal-weight real estate fund that also sells call options. Indicated yield is 10.53%, YTD return 4.55%. As a sector, we think covered calls makes sense for real estate. It is generally a stable sector, which lowers call premiums, but it also is a sector with high yields. So the options simply add more income to a relatively (usually) flattish sector. It has a short history, but so far so good. It has $130M in assets and fees are 0.65%. One year return is 8.06%. We also like XRE (no covered calls). It has outperformed but offers lower ongoing income. Most covered call funds will underperform in rallies. Internationally, we would suggest CGR.