RMR Asia Pacific Real Estate Fund (RAP)
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General Discussion on RAP
Is this a buy or a sell? ReplyKeep an Eye on REITs' Correlation With Equities [view article]
I would be more concerned about the correlation with the Case-Shiller housing index. IYR also doubled in 4 years between 2003 and 2007 ...prior to that it was pretty flat.And I realize IYR has a high % of commercial property, but I think investors bid it up mainly because it was a real estate play and more liquid than buying actual property. In fact, IYR got a big lift right after Paulson's mortgage plan was announced ...which won't directly affect commercial property at all!
Finally, I agree foreign REITs might be the way to go though ...as long as you avoid other bubble countries! The Economist had a great article on which countries have inflated housing prices a few issues back.
Reply
Warming Up To International Real Estate Funds [view article]
The problem with EGLRX (and AWP, I assume) is that it is not a pure play on international (non-US). It is "global RE" and thus has a variable (management discretion) US component. Last I looked it was about 15% ReplyWarming Up To International Real Estate Funds [view article]
You might consider some open end funds: IRFIX, FIREX, MSUAX (closed to new investors) and EIIPX. The best are EGLRX and EIIPX at present.Allen M. Demby, MD Reply
Finance
Warming Up To International Real Estate Funds [view article]
Here were some thoughts on DRW which launched earlier this week. I had some readers express concern over such a newly launched instrument, but I think it's a legit move for anyone seeking some international/RE exposure; this is also timely wrt the US interest rate concern raised above.An additional consideration is that real estate is more of a local phenomena than say, an indicator of overall market returns. Look at the US now (stocks way up since 2005, RE lousy in general). Even when the stock market performed poorly early this decade after the dot-com bust, home prices increased at record levels. Additionally, certain markets are still appreciating today, even though the Miami beaches and Jersey shores, etc. are seeing prices continue to decline. Each of these countries has a different dynamic and the correlation coefficient of real estate returns compared to that of stock market returns in aggregate is much less than 1. I love the diversification and low correlation properties of the ETF in addition to the impressive backtested return. Reply
Nusbaum
Warming Up To International Real Estate Funds [view article]
I read the link you provided and I'm not sure he is saying that, I see the part about the hedge for the floating rate fund he favors, so <em>if</em>... that is what he means....In general terms higher rates tend to create a challenge for emerging markets so that could create a problem for real estate companies from those markets.
I don't see the connection when talking about RE companies from say the UK, Norway, western Europe or Australia. An exception to the aussie exception might be Westfield which is the biggest company in the space. Despite being located in Australia something like 59% of its properties are located in the US. And in fact there is some history to say that when US rates go up Westfield goes down.
Maybe he's right? Reply
Nusbaum
Warming Up To International Real Estate Funds [view article]
I tend to be product agnostic. I'll buy whatever I think is the best thing that captures the effect, stock, ETF, CEF and even OEF (but it is rare that i think an OEF is best). I may or may not turn out to be right with the product I choose but....In this space, I have been very impressed with everything I know about Alpine. The AWP is brand new, they've barely started investing so I don't think we know anything about it yet other than the manager is good (IMO) and the OEF version has been a good hold.
I don't know if or when I will hop in here but I would also add that as I have started to study this segment I have found several stocks that I might end up preferring over any fund. Reply
Warming Up To International Real Estate Funds [view article]
Hi Roger,I was looking at the articles on Seeking Alpha on the funds you mentioned, and there's an interesting excerpt from a Jeffrey Saut essay in which he mentions the funds:
<b>Jeffrey Saut's Closed-End Fund Picks For This Interest Rate Environment</b>
He argues that international REITs will do badly if US interest rates rise. Do you agree with that? Reply
Warming Up To International Real Estate Funds [view article]
Roger, what are your thoughts about using closed-end funds when there are ETFs available now like the WisdomTree fund you mentioned? ReplyNusbaum
Warming Up To International Real Estate Funds [view article]
I didn't know there was an iShare equivalent in the hopper, thanks for the heads up on it. ReplyWarming Up To International Real Estate Funds [view article]
also FIREX for an OEF.but i think the long-term choice is the yet to be released ETF from iShares called ishares FTSE NAREIT Global Real Estate ex-US -- it's expected to have expense ratio of 0.48% (no way IRFAX can overcome that advantage, as an aside -- Dan, I assume you are a broker!!). don't know all the details yet since it hasn't started trading but i expect i to be similar to RWX (one of the fastest growing ETF launches in history) but at a lower ER (.48 vs. .60 for RWX) and I believe will have an even broader index to which it will track.
i personally own EGLRX but will switch to the ishares product when it launches. Reply
Finance
Warming Up To International Real Estate Funds [view article]
Greetings, I did an article on international real estate funds a while back. I thought I'd add one to the mix: "the next fund I want to highlight is Cohen & Steers International Realty A (IRFAX). Now, this fund does carry a 4.5% load, which I normally advise against; and the annual fee is 1.7%. However, this fund performed even better than the EGLRX, so you can practically take your pick." Over the prior two years, even with the load, would have done well with the IRFAX. Had some extra into on oversees REITs; check it out if interested:everydayfinance.blogsp...
Morningstar report for IRFAX;
quicktake.morningstar....;Symbol=IRFAX&... Reply