For investors looking for momentum, Invesco S&P 500 Equal Weight Real Estate ETF (EWRE - Free Report) is probably a suitable pick. The fund just hit a 52-week high, up roughly 29.5% from its 52-week low of $24.71/share.
But does it have more gains in store? Let’s take a look at the fund and its near-term outlook to gain an insight into where it might be headed:
EWRE in Focus
EWRE invests at least 90% of its assets in securities included in the S&P 500 Equal Weight Real Estate Index. EWRE is charging 40 bps in fees. The fund has amassed $49.5 million in AUM.
Why the Move?
The Federal Reserve has cut interest rate for the first time since 2008 at the FOMC meeting in July 2019. When interest rate drops, mortgage rates fall, making real estate or refinancing mortgages more affordable. This in turn results in higher real estate sales. Further, escalating Sino-US trade war tensions, uncertainty in market conditions due to geo-political tensions, slowdown in the global economy and Brexit woes are making investors jittery, adding to the lure of these funds. This is because these funds offer outsized yields and act as good investing options when increased safe-haven trades keep yields at check.
More Gains Ahead?
Currently, EWRE has a Zacks Rank #3 (Hold) making it hard to get a handle on the fund’s future returns. However, it seems EWRE might remain strong given a positive weighted alpha of 15.70.
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