REITs Squeezed As Earnings Begin

  • U.S. equity markets posted their worst week since October amid an ongoing "short squeeze saga" that raised questions regarding market stability, overshadowing a strong week of earnings reports and economic data.
  • Impacted by the fallout from the ongoing battle between institutional and self-directed "retail" investors, the S&P 500 slid by 3.3% on the week, erasing its gains for the year.
  • Real estate equities were a source of stability on the week, however, following a series of solid earnings reports and dividend increases as the broad-based Equity REIT ETFs declined 0.9%.
  • Several of the most troubled mall REITs, along with a handful of other heavily-shorted REITs have been swept up in the short squeeze frenzy. Many of the "squeezed REITs" jumped over 10% on the week.
  • Overshadowed by the short squeeze phenomenon, we saw a handful of REIT dividend increases and strong earnings results from the industrial, cell tower, manufactured housing, and homebuilding sectors.

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Disclosure: A complete list of holdings and Real Estate and Housing Index definitions and holdings are available at HoyaCapital.com. Hoya Capital Real Estate advises an Exchange Traded Fund listed on the NYSE. Hoya Capital is long all components in the Hoya Capital Housing 100 Index.

Additional Disclosure: It is not possible to invest directly in an index. Index performance cited in this commentary does not reflect the performance of any fund or other account managed or serviced by Hoya Capital Real Estate. Data quoted represents past performance, which is no guarantee of future results. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy.

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