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Is Invesco KBW Premium Yield Equity REIT ETF (KBWY) a Strong ETF Right Now?
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The Invesco KBW Premium Yield Equity REIT ETF (KBWY - Free Report) was launched on 12/02/2010, and is a smart beta exchange traded fund designed to offer broad exposure to the Real Estate ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Invesco, and has been able to amass over $212.68 million, which makes it one of the average sized ETFs in the Real Estate ETFs. Before fees and expenses, KBWY seeks to match the performance of the KBW Nasdaq Premium Yield Equity REIT Index.
The KBW Nasdaq Premium Yield Equity REIT Index is a dividend weighted index seeking to reflect the performance of approximately 24 to 40 small- and mid-cap equity REITs in the US.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.35% for KBWY, making it on par with most peer products in the space.
KBWY's 12-month trailing dividend yield is 8.50%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Real Estate sector - about 100% of the portfolio.
When you look at individual holdings, Global Net Lease Inc (GNL - Free Report) accounts for about 7.98% of the fund's total assets, followed by Site Centers Corp (SITC - Free Report) and Brandywine Realty Trust (BDN - Free Report) .
Its top 10 holdings account for approximately 46.45% of KBWY's total assets under management.
Performance and Risk
The ETF has lost about -5.12% so far this year and is up about 1.58% in the last one year (as of 03/24/2025). In the past 52-week period, it has traded between $16.62 and $21.54.
The fund has a beta of 1.31 and standard deviation of 23.37% for the trailing three-year period, which makes KBWY a medium risk choice in this particular space. With about 32 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco KBW Premium Yield Equity REIT ETF is a reasonable option for investors seeking to outperform the Real Estate ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Real Estate Select Sector SPDR ETF (XLRE - Free Report) tracks Real Estate Select Sector Index and the Schwab U.S. REIT ETF (SCHH - Free Report) tracks Dow Jones U.S. Select REIT Index. Real Estate Select Sector SPDR ETF has $7.35 billion in assets, Schwab U.S. REIT ETF has $7.49 billion. XLRE has an expense ratio of 0.08% and SCHH charges 0.07%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Real Estate ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Is Invesco KBW Premium Yield Equity REIT ETF (KBWY) a Strong ETF Right Now?
The Invesco KBW Premium Yield Equity REIT ETF (KBWY - Free Report) was launched on 12/02/2010, and is a smart beta exchange traded fund designed to offer broad exposure to the Real Estate ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
The fund is managed by Invesco, and has been able to amass over $212.68 million, which makes it one of the average sized ETFs in the Real Estate ETFs. Before fees and expenses, KBWY seeks to match the performance of the KBW Nasdaq Premium Yield Equity REIT Index.
The KBW Nasdaq Premium Yield Equity REIT Index is a dividend weighted index seeking to reflect the performance of approximately 24 to 40 small- and mid-cap equity REITs in the US.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Operating expenses on an annual basis are 0.35% for KBWY, making it on par with most peer products in the space.
KBWY's 12-month trailing dividend yield is 8.50%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Real Estate sector - about 100% of the portfolio.
When you look at individual holdings, Global Net Lease Inc (GNL - Free Report) accounts for about 7.98% of the fund's total assets, followed by Site Centers Corp (SITC - Free Report) and Brandywine Realty Trust (BDN - Free Report) .
Its top 10 holdings account for approximately 46.45% of KBWY's total assets under management.
Performance and Risk
The ETF has lost about -5.12% so far this year and is up about 1.58% in the last one year (as of 03/24/2025). In the past 52-week period, it has traded between $16.62 and $21.54.
The fund has a beta of 1.31 and standard deviation of 23.37% for the trailing three-year period, which makes KBWY a medium risk choice in this particular space. With about 32 holdings, it has more concentrated exposure than peers.
Alternatives
Invesco KBW Premium Yield Equity REIT ETF is a reasonable option for investors seeking to outperform the Real Estate ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
Real Estate Select Sector SPDR ETF (XLRE - Free Report) tracks Real Estate Select Sector Index and the Schwab U.S. REIT ETF (SCHH - Free Report) tracks Dow Jones U.S. Select REIT Index. Real Estate Select Sector SPDR ETF has $7.35 billion in assets, Schwab U.S. REIT ETF has $7.49 billion. XLRE has an expense ratio of 0.08% and SCHH charges 0.07%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Real Estate ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.