Pacer Benchmark Industrial RE SCTR ETF retains its Morningstar Medalist Rating of Bronze. The portfolio maintains a sizable cost advantage over competitors, priced within the cheapest fee quintile among peers.  

 The strategy's investment process inspires confidence and earns an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant overweight position in quality exposure and an underweight in yield exposure compared with category peers. High quality exposure is attributed to stocks with low financial leverage and strong returns on equity. And a low yield exposure is rooted in holding fewer stocks with high dividend or buyback yields -- instead, typically holding stocks in an early stage of development. The team managing this passive strategy earns a Below Average People Pillar rating. The strategy's parent firm has some investor-friendly attributes, like overall attractive fees and a strong success ratio across its product lineup. As a result, the firm gets an Average Parent Pillar rating.

Analyst Rating

Public Storage

Prologis

CubeSmart

W. P. Carey

EastGroup Properties

Extra Space Storage

First Industrial Realty Trust

STAG Industrial

Rexford Industrial Realty

Terreno Realty

Morningstar's evaluation of this security's process aims to determine the likelihood that it will outperform its Morningstar Category index on a risk-adjusted basis over the long term. Pacer Benchmark Industrial RE SCTR ETF earns an Above Average Process Pillar rating. The most important driver of the rating is that this fund tracks an index. Historical data, such as Morningstar's Active/Passive Barometer, finds that passively managed funds have generally outperformed their active counterparts, especially over longer time horizons. Impressive risk-adjusted performance also supports the process. This can be seen in the fund's five-year alpha calculated relative to the category index, which suggests that the process was successful over that period. Lastly, the process is limited by the parent firm's five-year retention rate of 52%, which suggests it could do more to hold onto its portfolio managers.

The investment strategy as stated in the fund's prospectus is:  The investment seeks to track the total return performance, before fees and expenses, of the Solactive GPR Industrial Real Estate Index.  The index is generally composed of the equity securities of developed markets companies that derive at least 85% of their earnings or revenues from real estate operations in the industrial real estate sector, including companies that derive at least 85% of their earnings or revenues from self-storage real estate operations. The fund will invest at least 80% of the value of its net assets, plus the amount of any borrowings for investment purposes, and in companies the industrial real estate sector. The fund is non-diversified. 

 The portfolio is overweight in real estate by 2.6 percentage points in terms of assets compared with the category average, and its healthcare allocation is similar to the category. The sectors with low exposure compared to category peers are consumer cyclical and financial services; however, the allocations are similar to the category. The portfolio is composed of 32 holdings and is relatively concentrated. Specifically, 66.9% of the strategy's assets are housed within the top 10 holdings, compared with the typical peer's 59.9%. And in closing, in terms of portfolio turnover, on a year-over-year basis, 92% of the fund's holdings have changed, whether through increasing, decreasing, or changing a position.

Above Average

Process

Pacer’s team earns a Below Average People Pillar rating. The team is bolstered by its parent firm's five-year success ratio of 69%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median return for the period. However, the rating is held back by the instability of talent across its parent firm. The firm's asset-weighted manager tenure of seven years suggests it could do more to retain portfolio managers. The instability of its management team also holds the team back. The fund last saw a manager change two years ago.

Below Average

People

Pacer's track record as a steward is mixed, leading to an Average Parent Pillar rating. One notable advantage of Pacer is its below-average fees. On average, the firm's open-end and exchange-traded fund fees fall in the second-lowest quintile of category peers. The product lineup at Pacer has exhibited exemplary durability compared with peer asset managers when looked at over the past five years. Notably, its five-year risk-adjusted success ratio stands at 69%, meaning that 69% of its products have both survived and beaten their respective category median on a risk-adjusted basis. Portfolio management turnover at Pacer is higher than at peer firms, detracting from the overall assessment of the firm's stewardship. Turnover in the portfolio-management ranks can happen for a number of reasons, including mergers and liquidations, portfolio managers moving into other roles, or portfolio managers leaving the firm. In some cases, such change may not signal a serious or immediate problem at the firm, but can still be disruptive for investors, hinder the effectiveness of a firm’s investment processes, or suggest a weaker investment culture.

Average

Parent

Pacer Benchmark Industrial Real Estate SCTR ETF

INDS tracks an index of developed market companies that derive at least 85% of their revenue from industrial real estate activities. 

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OUTFRONT Media

REITs bounced back from a rough start to the year with a strong +3.26% average total return in March. Mid cap (+5.04%), small cap (+3.90%) and large cap REITs (+2.32%) averaged gains in March, while micro caps (-0.32%) saw yet another month in the red. 78.06% of REIT securities had a positive total return in March.

The State Of REITs: April 2024 Edition

American Homes 4 Rent

Brandywine Realty

Chatham Lodging Trust

Healthpeak Properties Inc

EPR Properties

Iron Mountain

Medical Properties Trust

REITs fell slightly deeper into the red in 2024 with a -0.81% total return in February. Mid cap (+1.46%) and large cap REITs (+1.04%) averaged gains in February outperforming small caps (-1.33%) and micro caps (-6.98%). Only 50.64% of REIT securities had a positive total return in February.

The State Of REITs: March 2024 Edition

Global X SuperDividend REIT ETF

Vanguard Real Estate ETF

Real Estate Select Sector SPDR Fund

Pacer Industrial Real Estate ETF (INDS) is a concentrated play on industrial REITs, focusing on warehouses and self-storage facilities.

INDS: Focused Industrial REIT With Higher Total Return Potential But Somewhat Risky

Bank of America

Citigroup

CorEnergy Infrastructure Trust

Goldman Sachs

JPMorgan Chase & Co

Morgan Stanley

Realty Income Corp

Office Properties Income Trust

The REIT sector had a rough start to 2024 with a -5.72% total return in January. Large cap REITs (-4.79%) outperformed their smaller peers in January. Micro cap REITs (-8.39%) averaged the steepest declines. Only 9.55% of REIT securities had a positive total return in January.

The State Of REITs: February 2024 Edition

American Tower

Diversified Healthcare Trust

Empire State Realty Trust

Kimco Realty

US Diversified Real Estate ETF

Pennsylvania Real Estate Investment Trust

Invesco Active US Real Estate

The REIT sector closed the year out strong with a +11.40% total return in December, pushing into positive territory for the full year (+8.66%). Small cap REITs (+13.39%) outperformed in December. Large cap REITs (+9.55%) averaged a lower return than their smaller peers. 90.79% of REIT securities had a positive total return in December with 66.25% in the black for the full year.

The State Of REITs: January 2024 Edition

Pacer Benchmark Industrial Real Estate SCTR ETF invests in industrial REITs, which have seen strong growth due to e-commerce demand. People have been avoiding commercial REITs, but not all are same. There are high quality commercial REITs in sectors other than office buildings. Industrial REITs include various types of real estate assets such as warehouses, fulfillment centers, and logistics infrastructure in strategically valuable locations.

INDS: Certainly Worth A Look

Equinix

NexPoint Residential Trust

REITs averaged a -5.31% total return in October and have now fallen to a double-digit negative total return year to date (-10.46%). Large cap REITs (-2.24%) outperformed their smaller peers in October. Micro caps (-11.32%) extended their streak of severe underperformance. 26.80% of REIT securities had a positive total return in October with just 25.00% in the black year to date.

The State Of REITs: November 2023 Edition

ARK Genomic Revolution Multi-Sector ETF

ARK Innovation ETF

Amplify Lithium & Battery Technology ETF

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ProShares Bitcoin Strategy ETF

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Amplify Transformational Data Sharing ETF

Bitwise Bitcoin And Ether Equal Weight Strategy Etf

VanEck Vectors Digital Transformation ETF

Dimensional US Core Equity 2 ETF

Global X Funds - Global X E-commerce ETF

Global X Telemedicine & Digital Health ETF

Vaneck Ethereum Strategy Etf

Amplify Emerging Markets FinTech ETF

AB Disruptors ETF

First Trust NASDAQ Clean Edge Smart Grid Infrastructure Index Fund

The Goldman Sachs Future Tech Leaders Equity ETF

ROBO Global Healthcare Technology and Innovation ETF

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iShares Genomics Immunology and Healthcare ETF

JPMorgan Equity Premium Income ETF

Global X Lithium & Battery Tech ETF

Proshares Online Retail ETF

Global X PropTech ETF

Good Morning, VettaFi Voices! Disruptive innovation is a popular topic, and it encompasses everything from bitcoin and cryptocurrency to electric vehicles to artificial intelligence.

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iShares U.S. Home Construction ETF

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iShares Mortgage Real Estate ETF

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Invesco S&P 500 Equal Weight Real Estate ETF

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Schwab U.S. REIT ETF

Pacer Funds Trust-Pacer Benchmark Data & Infrastructure Real Estate Sector ETF

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Alpine Global Premier Properties Fund

DoubleLine Commercial Real Estate ETF

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iShares International Developed Real Estate ETF

CBRE Global Real Estate Income Fund

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SPDR Dow Jones International Real Estate ETF

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iShares International Developed Property ETF

The history of construction spending since 1993 reveals that this data tends to weaken prior to recessions. For a recent dip in Residential Construction attributed to the rise in mortgage rates, this indicator is charging higher.

Construction Spending Rises

Global Net Lease

Industrial Logistics Properties

Power REIT

REITs averaged a -7.14% total return in September and have fallen into the red year to date. Small cap REITs (-6.51%) outperformed yet again in September. Micro caps (-10.45%) continue to severely underperform their larger REIT peers. Only 9.74% of REIT securities had a positive total return in September with 34.38% in the black year to date.

The State Of REITs: October 2023 Edition

Gladstone Commercial

Vanguard S&P 500 ETF

Industrial REITs have been battered by high interest rates and oversupply concerns. Their space remains in demand, and that demand could continue rising.

You Don't Have to Pick a Winner in Warehouse/Industrial REITs. Here's Why.

Americold Realty

Digital Realty Trust

Hersha Hospitality Trust Class A

The REIT sector gave up some of the gains achieved in June and July, with a -4.13% average total return in August. Small cap REITs (-2.49%) outperformed again in August. Micro caps (-13.08%) badly underperformed their larger REIT peers. Only 18.06% of REIT securities had a positive total return in August, with 48.13% in the black year to date.

The State Of REITs: September 2023 Edition

InnSuites Hospitality Trust

Strategic Residential & Apartment Real Estate ETF

Hoya Capital High Dividend Yield ETF

The REIT sector followed a strong June with further gains in July, averaging a solid +4.37% total return in July. Small-cap REITs (+5.23%) continued to outperform in July. Large caps (+2.46%) underperformed their smaller REIT peers for the 3rd straight month in July. 73.72% of REIT securities had a positive total return in July with 60.63% in the black year to date.

The State Of REITs: August 2023 Edition

Farmland Partners

Host Hotels & Resorts

Gladstone Land

PotlatchDeltic

After 4 straight months in the red, the REIT sector surged back into the black year to date with a stellar +7.41% total return in June. Small cap REITs (+8.59%) outperformed again in June. Large caps (+5.51%) again underperformed their smaller REIT peers in June. A remarkable 87.34% of REIT securities had a positive total return in June with 49.69% in the black year to date.

The State Of REITs: July 2023 Edition

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First Trust NASDAQ Clean Edge Green Energy Index Fund

VanEck Rare Earth/Strategic Metals ETF

iShares 10-20 Year Treasury Bond ETF

Simplify Short Term Treasury Futures Strategy ETF

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Hello! This is markets reporter Isabel Wang bringing you this week's ETF Wrap. In this week's edition, I spoke with CFRA's Aniket Ullal, head of ETF data and analytics, about thematic ETF ideas and investment categories for the second half of 2023.

Here are ETF themes and categories investors may want to consider in the second half of 2023

Logistics REITs offer sector growth and resilience. They provide stability and dividends to a diversified portfolio component.

You Don't Have to Pick a Single Winner Among Logistics REITs -- Here's Why

Due to a surge in e-commerce, strong supply & demand dynamics for logistics assets should mean the Industrial real estate investment trust sector will be a long-term outperformer. As the only exchange-traded fund investing in industrial REITs, specifically in self-storage REITs, INDS thus becomes a lucrative option for long-term growth-seeking investors. INDS generates decent total returns, and performance of its overall portfolio can be termed quite satisfactory. The fund is currently trading almost at par.

INDS: Future Growth Prospect Of Industrial REITs Makes This ETF Attractive

ProShares Short Real Estate

Virtus Real Asset Income ETF

U.S. equity markets climbed to their highs of the year as investors took positions ahead of a critical slate of inflation data and an anticipated "pause" in the Fed's rate hike cycle.

Fed Looms Over New 'Bull Market'

Wall Street experts differ in their outlooks for America's housing market.  Wharton professor Jeremy Siegel, real estate tycoon Jeff Greene, and others have warned that home prices will drop, while others like "Shark Tank" star Barbara Corcoran are more optimistic.

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In recent years, real estate investment trusts (REITs) have become increasingly popular among investors seeking exposure to the real estate sector without the hassle of owning and managing physical properties. Additionally, exchange traded funds (ETFs) have made it easier than ever to invest in a diversified portfolio of these REITs.

4 Top-Performing Real Estate ETFs You Should Consider

Cambria Global Real Estate ETF

Blackstone Group

CBRE Group

FlexShares Global Quality Real Estate Index Fund

Xtrackers International Real Estate ETF

Indus Realty Trust Inc

Jones Lang LaSalle

Nuveen Real Estate Income Fund

No slowdown here. After the worst year of performance on record in 2022, Industrial REITs have rebounded this year after earnings results showed a surprising re-strengthening of property-level fundamentals. Recent earnings results showed that demand continues to substantially outpace available supply. Rent growth reaccelerated in early-2023, with rental spreads averaging over 40%, while occupancy rates climbed to fresh record.

Industrial REITs: We Love Logistics

News for Pacer Benchmark Industrial Real Estate SCTR ETF ETF (INDS)