This Real Estate Investment Trust ETF began trading last September. It’s top five holdings include: Medical Properties Trust, Inc. (MPW, 1.66% of assets); Omega Healthcare Investors, Inc. (OHI, 1.59%); Spirit Realty Capital, Inc. (SRC, 1.57%); Vornado Realty Trust (VNO, 1.54%); and Equity Residential (EQR, 1.54%).
Hoya Capital High Dividend Yield (RIET)
From The Dividend Hunter
Most exchange-traded funds mirror a specified index. Hoya Capital developed its own index, the aptly named Hoya Capital High Dividend Yield Index. The index is rules-based designed to provide diversified exposure to 100 U.S.-listed real estate-related securities that collectively provide income through high dividend yields.
The index and ETF rebalance twice a year on the first business days of June and December. According to CEO Pettee, they have the ability to do a special interim rebalance if the need arise The fact that the portfolio stocks are not market cap-weighted is a unique feature of the RIET ETF. Also, the larger weights for small and mid-cap REITs should produce a higher yield than an REIT fund that uses a market cap weighting. Ditto for the preferred stock holdings.
RIET pays monthly dividends and currently yields 6.9%. For comparison, the largest REIT ETF, the Schwab U.S. REIT ETF (SCHH), is loaded up with the large-cap, low-yield REITs. SCHH yields 2.5%.
The RIET dividend will reset each quarter to match the projected income of the fund’s portfolio. This dividend policy means you will earn the same dividend for three months, and then it will reset. I expect steady dividend growth over time based on how the index works.
I view RIET as probably the most conservative of the ETFs in the Dividend Hunter portfolio. I look forward to building up my position in this fund.
Editor’s Personal Position: Long RIET
Tim Plaehn, The Dividend Hunter, yn345.isrefer.com/go/cabmdpc/cab/, January 2022