Morningstar Minute: BMO best for Canadian REIT ETFs

An equal-weighted methodology helps avoid concentration risk.

Jeffrey Bunce, CFA 11 November, 2016 | 6:00PM
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Jeff Bunce: For Morningstar.ca, I'm Jeff Bunce. Canadian real estate investment trusts, or REITs, have become a popular investment over the past few years for their diversification benefits within a total portfolio and for the relatively high income they produce. Indeed, REITs have a low correlation with Canadian fixed income and are a complement to global stocks as well. The bigger draw, however, may be from their yield. With a payout of around 5% to 6%, REITs offer a large premium over the less than 2% an investor can get right now in investment-grade fixed income.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Riocan Real Estate Investment Trust22.57 CAD-0.57

About Author

Jeffrey Bunce, CFA

Jeffrey Bunce, CFA  Jeffrey Bunce, CFA, is a senior investment analyst for Morningstar’s Investment Management group.

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