Prediction: This Will Be the Best-Performing Vanguard ETF Through 2025
I wouldn't be surprised to see the Vanguard Real Estate ETF outperform all other Vanguard ETFs between now and the end of 2025. Real estate is perhaps the most rate-sensitive area of the stock market and has dramatically underperformed recently.
Prediction: These 3 Vanguard ETFs Will Double Investors' Money in 5 Years
Three groups of stocks that have dramatically underperformed the market are small-cap stocks, value stocks, and real estate investment trusts. All three could get a major tailwind if the Federal Reserve starts lowering interest rates as expected.
VNQ: Don't Fear A Recession, It's A Great Time To Accumulate This ETF
The real estate stocks segment has fallen from all-time highs, but may offer long-term value. The lowering of interest rates signals the end of this economic cycle, and historically, real estate tends to perform well in the stock market, even though it may seem illogical. Consider starting or continuing a Dollar-Cost Averaging plan in the real estate stock segment due to recession concerns.
VNQ: REITs Passed The Recent Test
VNQ is a large, diversified REIT ETF that can be used as a benchmark for REIT performance under different macro scenarios. VNQ performed well during the recent growth scare. It should also perform well under a stable economy with falling inflation.
VNQ: Clarifying The Confusion
Commonly quoted dividend yield understates the attractiveness of VNQ's current valuation. The inclusion of returned capital in the calculation of VNQ's dividend yield can be misleading. VNQ is currently trading at the most attractive levels in a decade when capital return is excluded from the dividend yield calculation.
These 3 Vanguard ETFs Have Lagged the Market so Far in 2024, but Here's Why They're Great Investments Right Now
Small-cap stocks and value stocks have underperformed the market for the past several years. There are good reasons for the poor performance, but there's also reason to believe things could be about to change.
A Cautionary Note On The Impending REIT Rally
SA analysts are optimistic about REITs due to an expected interest rate drop. REITs dropped more than the Russell 2000 and the equal-weight S&P 500 in response to interest rate increases. Future developments are far from certain; be cautious about a REIT rally.
Profit From Emerging Uptrend in REITs Using Call Options
We are witnessing a rotation out of large-cap tech and into rate-sensitive real estate.
Prediction: This Will Be the Best-Performing Sector of the Second Half of 2024
The real estate sector has been a major laggard over the past couple of years. Much of the poor performance is due to the rising-rate environment and not because of any problems with the underlying real estate businesses.
VNQ: How Falling Interest Rates Would Impact REITs
Market consensus predicts a 70% chance of a 25 basis point rate cut in September and two cuts by December. Falling interest rates could benefit REITs through cap rate decline, transaction volume increase, cost of capital reduction, multiple expansion, and M&A stimulation. Discounted preferreds and REITs with moderate to high leverage with strong businesses may be best positioned to take advantage of falling interest rates.
2 Top ETFs to Buy Now That Could Help Set You Up for Life
Lower interest rates could spark a rally in the real estate market. Rate cuts should also be a boon for small-cap stocks.
VNQ: Not An Optimal Way To Approach REIT Investing
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.
