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I don't know if REIT aggressively remark the value of their property to adverse market conditions. I would watch how much they marked down their assets otherwis
by cm2187 3y ago
I don't know if REIT aggressively remark the value of their property to adverse market conditions. I would watch how much they marked down their assets otherwise you might buy at a very overinflated value.
- infecto 3y agoI might be mistaken but I thought it was the inverse. REITs that trade on the public market would have pricing that reflects the market opinion regardless of how the books are marked. The issue in general with RE is that you would be marking your books based on comps and the mark downs will lag the market. Not investment advice but sometime in the past year to now is when you would want to be investing in publicly traded REITs if you thought there was going to be a rebound. Private funds like a Fundrise are the ones where their marks are going to be lagging the market as its purely on book value.
- cm2187 3y agoSurely at one point someone has to invest into the fund, you can't just buy shares on the secondary market otherwise how do they fund assets? For ETFs, market makers are liaising with the issuer to issue and redeem as the demand fluctuates. But that only works for liquid underlying assets.
- infecto 3y agoI think that is conflating the ETF and the underlying REIT. The REIT has a float that is going to be similar to any other publicly listed company. The market is setting the price and underlying value of the REIT. The ETF which has a basket of those REITS, will include authorized participants that are creating and redeeming shares based on the underlying REITS. Are there any REIT ETFs with basket holdings including non-traded assets? I am not sure but I don't know of any. So the ETF is indeed redeeming/creating based on market supply/demand but its of an underlying public traded REIT.