How One REIT ETF is Seeking to Meet Demand for High-Income Investment Products
In designing the Hoya Capital High Dividend Yield ETF, the fund manager focused on how different market environments affect property sector weights and diversification rules it set for the index.
Wealth Management Real Estate | By Beth Mattson-Teig
Real estate ETFs continue to attract attention from both investors and asset managers. As of September 30, there were 43 U.S. or global equity real estate ETFs managing $89 billion in assets, according to data from research firm CFRA. Year-to-date inflows of new capital amount to roughly $11.5 billion, while the sector also has added nearly a dozen new funds.
Hoya Capital Real Estate is one firm that is hoping to capitalize on investor demand for ETFs and high-yielding income products. The company recently launched its second ETF fund, Hoya Capital High Dividend Yield ETF (NYSE: RIET). No, that’s not a typo. The “i before e” highlights the fund’s income first strategy. RIET expects to pay monthly distributions. As of August 31st, RIET was delivering an index yield of 6.7 percent, which is twice the dividend yield of the FTSE Nareit All REIT Index of 3.2 percent as of Oct. 8th.
WMRE recently talked with Alex Pettee, CFA, president and director of Research & ETFs at Hoya Capital Real Estate to hear more about the fund’s strategy and where he’s finding yield in the current market.