For investors looking for momentum, Nuveen Short-Term REIT ETF (NURE - 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 $24.03/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:
NURE in Focus
The fund provides exposure to U.S. real estate investment trusts (REITs) with short-term lease agreements which might display less price sensitivity to interest rate changes than REITs with longer-term lease agreements. NURE tracks the investment results, before fees and expenses, of the Dow Jones U.S. Select Short-Term REIT Index. NURE is charging 35 bps in fees. The fund has amassed $59.5 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, 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 trade keeps yields at check.
More Gains Ahead?
Currently, given the uncertain market conditions, it hard to get a handle on the fund’s future returns. However, it seems NURE might remain strong given a positive weighted alpha of 12.70.
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