FBRT - REITs Rip Higher As Rates Do Nothing
2024-02-16 04:54:12 ET
Summary
- Rates were down by less than a bunny’s tail.
- REITs were hopping anyway.
- Higher rates are bad and all that jazz.
- Enjoy the notes on a few equity REITs.
Most investors today know that REITs are sensitive to interest rates. The sensitivity will vary between different REITs and different types of REITs, but there is pretty much always some sensitivity to interest rates. That makes sense, because discount rates change.
Assuming no recession, higher yields on Treasuries means higher interest expense for companies and (as the debts gradually roll over). In theory, the investors also apply higher discount rates....
REITs Rip Higher As Rates Do Nothing