REET vs. GQRE: Which Global Real Estate ETF Is the Better Buy?

The FlexShares Global Quality Real Estate Index Fund (NYSEMKT:GQRE) carries a importantly higher disbursal ratio and humanities drawdown than the iShares Global REIT ETF (NYSEMKT:REET), though it whitethorn entreaty to investors seeking a higher yield.

Both funds supply vulnerability to planetary existent property markets, though they utilize antithetic weighting strategies. While REET tracks a wide scale of developed- and emerging-market REITs, GQRE applies a quality-focused methodology to its enactment process. This examination highlights however these antithetic approaches interaction costs, risk, and portfolio composition.

Snapshot (cost & size)

Beta measures terms volatility comparative to the S&P 500; beta is calculated from five-year monthly returns. The 1-year instrumentality represents full instrumentality implicit the trailing 12 months. Dividend output is the trailing-12-month organisation yield.

REET is the lower-cost enactment with an disbursal ratio of 0.14%. While GQRE’s disbursal ratio is 3 times that -- astatine 0.45% -- it presently provides a higher payout for income-seeking investors, with a dividend output of 4.3%.

Performance & hazard examination

What's wrong

FlexShares Global Quality Real Estate Index Fund (GQRE, launched successful 2013) holds 178 securities focused wholly connected existent property and REITS -- though it besides holds a astir 2.4% currency position. Its largest positions see American Tower (NYSE:AMT) astatine 6.0%, Prologis (NYSE:PLD) astatine 4.3%, and Welltower (NYSE:WELL) astatine 4.0%. This portfolio reflects GQRE’s quality-based indexing strategy, and the money has a trailing 12-month dividend output of 4.3%.

iShares Global REIT ETF (REET, launched successful 2014) provides broader diversification with much than 320 holdings, including a comparatively smaller 0.5% currency position. Its largest holdings see Welltower astatine 8.5%, Prologis astatine 7.4%, and Equinix (NASDAQ:EQIX) astatine 5.9%. Compared to GQRE, it offers a broader scope crossed the planetary existent property marketplace and a trailing-12-month dividend output of 3.4%.

For much guidance connected ETF investing, cheque retired the afloat usher here.

What this means for investors

For investors looking to summation vulnerability to planetary existent estate, REET and GQRE correspond 2 meaningfully antithetic approaches to the aforesaid assemblage -- and the champion prime truly depends connected what you're trying to accomplish.