CBLAQ - REITs Getting Short Squeezed

• The breathtaking surge in GameStop - along with a swelling number of heavily-shorted stocks - has sent shockwaves through financial markets amid an ongoing battle between institutional and self-directed investors.
• Initially set into motion by a sharp vaccine-driven rally from many "COVID-sensitive" companies, a surge in self-directed investor participation has magnified the "short squeeze" phenomenon to extreme levels.
• Mall REITs, along with a handful of other heavily-shorted REITs, have been swept up in the short squeeze frenzy. Six REITs have surged more than 50% this month while three have doubled.
• Reversing the "Cheap REITs Stay Cheap" effect that defined 2020, the 15 most heavily-shorted equity REITs have jumped 44% so far this year compared to the modest 1% gain on the broader REIT average.
• Hedge funds have historically been reluctant to short REITs due to high dividend yields. Ironically, the wave of dividend cuts last year opened the door to increased short interest.

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