SRET: When 7.5% Dividend Does Not Justify The Risk

Summary

• SRET holds 30 geographically diversified REITs, with a focus on extracting high dividend yield.
• SRET's exposure to struggling commercial real estate sectors such as office, retail, healthcare, and a separate 16% allocation to mortgage REITs renders the ETF of a rather speculative nature.
• Moreover, the company selection process does not factor in a robust analysis of underlying fundamentals but rather relies on high-level technical screening criteria.
• Given that there are many better REIT alternatives offering similar and even higher yields that are backed with sound fundamentals, SRET is a clear sell in my opinion.

Phiwath Jittamas

Global X SuperDividend REIT ETF (NASDAQ:SRET) tracks 30 high yielding REITs, which are geographically diversified across US and international space.

SRET's strategy is to capture high yield returns with a potential to systematically grow the payable dividend streams

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.