tl

REITs: An Update

I believe much of what propelled REITs since January was the absolutely unexpectedly massive rate cuts by the Fed. That changed the game completely. Now REITs's yields actually look attractive. My concern with holding a position in SRS is that rates are not likely to rise in the near term, so REITs would have to report serious earnings disappointments in the near term for SRS to perform.

REITs: An Update

Toro, you've owned SRS for a while now. Do you realize the nasty value decay that holding an ultrashort hands you? I only realized this after watching SRS for several months. As you wait for REITs to finally admit weakness (at least by their stock prices), your SRS holdings fall in value even if IYR is flat over time.

I think you're right: REIT stocks will ultimately correct. But while you wait to be proven right, your SRS falls further. Maybe shorting IYR is the smarter play -- but there are obvious risks doing that as well.