Pisani: Big Bet on REITs Recovery
What's up with Real Estate Investment Trusts (REITs)? The MSCI Reit Index is up another 2.7 percent to another new high, far outperforming other sectors.
There is no big upgrades, or even strong individual stories.
A quick check with traders comes up with a grab-bag of reasons:
1) real estate fundamentals are bottoming
2) short interest, once high, continues to drop
3) fund flows are increasing
4) increasing access to capital.
One analyst who just got out of meetings with large fund managers noted that his clients were underweight and are being forced to put money back to work.
He noted that there was not a lot of product for sale, that lenders are not being forced to foreclose, and that everyone is still searching for yield.
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