In yet another sign of real estate’s strong end to 2023, the active real estate ETF REIT is sending signals. Specifically, the ALPS Active REIT ETF (REIT ), saw its price rise above its 200-day simple moving average (SMA) to start December.
That follows similar action for its sibling REIT strategy, the ALPS REIT Dividend Dogs ETF (RDOG ), to end November. REIT takes a different approach, however, and has other reason to start off 2024 strongly.
Active Real Estate ETF REIT's Tech Signal
Indeed, REIT launched back in February 2021, setting it up to start 2024 by hitting its three-year ETF milestone. Traditionally, that brings an ETF more attention, as some investors wait to see three years of track record to consider a strategy.
That would follow this recent tech action, with REIT’s price rising to $24.07 compared to $23.95 for its 200-day SMA, per YCharts. Together, REIT’s tech action and third birthday could give it a big boost in the next several weeks.
So, how does the strategy invest? REIT takes an active approach, which sets it apart from its dividend-focused sibling. REIT actively invests in common equity securities from U.S. REITs, but also may invest in other U.S. real estate companies. It uses a proprietary methodology to assess factors like the value of properties held by various REITs as well as the value of the REITs themselves.
That active real estate approach offers some benefits in an uncertain environment. While REIT-related strategies have recently seen some positive returns, it is still a complicated space impacted by high interest rates. An active strategy could operate more nimbly than a passive competitor, able to react to events or local market changes quickly.
See more: As Actives Rise, Eye Active Growth ETF LGRO
Overall, for a 68 basis point fee, REIT has outperformed its ETF Database Category and FactSet Segment Averages YTD. The active real estate ETF has returned 3.2% YTD and recently spiked returning 13.5% over the last month, per VettaFi. For investors looking to get some diversification and join the active ETF craze this year, REIT could be an option to consider.
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