MFO - REM: Mortgage REITs Are Ripe For A Pullback

U.S. real estate sectors continue to be on a tear, as homebuilders (XHB) and major REITs ETFs including REZ, IYR and REM piling on between 7-8% YTD gains:

Source: WingCapital Investments

In the case of mortgage REITs ETF (REM), which has been highly correlated with 10-year Treasury yields for bulk of the past decade, the explosive rally is particularly worth mentioning as it was able to buck the trend with interest rates stuck near all-time lows:

Source: U.S. Department of The Treasury

Indeed, unlike other REITs which tend to benefit

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