VNQ - VNQ: Not An Optimal Way To Approach REIT Investing
2024-06-24 09:37:13 ET
Summary
- Investing in Vanguard Real Estate Index Fund ETF is not an optimal way how to approach REIT investing in this environment.
- By going long VNQ, investors open an unnecessary exposure towards small-cap REITs at a relatively unattractive dividend yield.
- Instead, if investors are willing and able to conduct a proper due diligence, it is better to cherry-pick specific names that offer better risk-adjusted opportunities.
The Vanguard Real Estate Index Fund ETF Shares ( VNQ ) is the largest REIT ETF out there with a market cap of over $60 billion. This ETF invests in equity REITs and follows a full replication strategy of the MSCI US Investable Market Real Estate 25/50 Index. The underlying index is designed to capture the large, mid and small cap segments of the U.S. equity REIT universe....
VNQ: Not An Optimal Way To Approach REIT Investing