Want to invest in real estate without the huge hassle of purchasing an investment property? Buying a real estate investment trust (REIT) ETF could be the answer. Investing in REITs can be a great way of implementing a dividend growth investing strategy. Start Investing in REIT ETFs today with Wealthsimple: https://wealthsimple.sjv.io/0JXbBJ
Investing in Canadian real estate investment trusts (REITs) can be a great way of gaining real estate exposure in your investment portfolio without the hassle of a rental property. Shares of REITs trade on exchanges like stocks and often payout monthly income.
0:00 Intro 2:11 Best Dividend REIT ETF #1 4:50 Best Dividend REIT ETF #2 7:18 Best Dividend REIT ETF #3 9:24 Best Dividend REIT ETF #4 11:28 Best Dividend REIT ETF #5
A real estate investment trust (REIT) ETF is an open-ended fund that holds a “basket” of different REITs. When investors buy shares of the REIT ETF, they receive a proportional “slice” of this basket and exposure to both the returns and risk of all the underlying REITs it holds. But crucially, because REIT ETFs hold a diversified basket of REITs, they lower risks and improve your overall risk-return profile.
Unlike REIT mutual funds, REIT ETFs trade throughout the day on stock exchanges, and can be bought and sold intra-day on most brokerage apps. They’re considered an eligible investment that can be held in most accounts.
When it comes to their strategy, Canadian REIT ETFs can be passively or actively managed. Passive REIT ETFs track an externally provided index of Canadian REITs and try to replicate the index’s holdings and performance as closely as possible. Their goal is to match the index's performance, not beat it.
On the other hand, active REIT ETFs create their own strategies to choose Canadian REITs to outperform a specific benchmark. They’re not constrained by the rules of an external index. These ETFs tend to be costlier than their passively managed counterparts.
Unlike individual REITs, REIT ETFs charge a management expense ratio (MER), expressed as an annual percentage fee. The MER pays for the ETF manager’s trading, operational, administrative, and marketing costs. For example, a Canadian REIT ETF with a MER of 0.61% would cost around $61 annually in fees for a $10,000 investment.
Disclaimer: This channel is for education purposes only and opinions expressed in this video are based on personal research and should be treated as such. These are not instructions, suggestions, nor directions as to how to handle your money. The facts and figures presented in this video are up-to-date based on the recording. These may have changed based on when you watch the video, please, always do your own due diligence! The description of this video includes Affiliate links (I get paid at no cost to you for trying out a particular service.) #BestReitETFs #MonthlyPassiveIncome #BuildLongTermWealth