The Real Estate sector outperformed the broader U.S. equity market for much of 2019, providing investors with a combination of income and capital appreciation. But what lies ahead for the sector remains harder to determine for advisors, particularly if a recession emerges. Which sub-industries are positioned to perform better, and which may perform worse next year?
We explored this topic further in a discussion led by Todd Rosenbluth, CFRA Head of ETF & Mutual Fund Research, and featuring Thomas Youn, Portfolio Manager of Guggenheim Risk Managed Real Estate Fund, and Chris Kuiper, CFRA Real Estate Equity Analyst.
Highlights of the discussion:
Thomas Youn, CFA, Managing Director, Portfolio Manager, Guggenheim Investments
Mr. Youn joined Guggenheim in 2009, as a Portfolio Manager focusing on REITs and other publicly traded real estate equities. Prior to joining Guggenheim in 2009, Mr. Youn worked at Cliffwood Partners, where he served as a real estate generalist covering REITs and real estate C-Corps in the U.S. and Canada. He also assisted with portfolio construction and development of key investment themes and exposure targets for hedged and long-only real estate strategies. Previously, Mr. Youn was a Senior Equity Research Associate for Green Street Advisors covering the retail REIT sector. He gained private real estate market experience as an Acquisition Associate for AEW Capital Management’s direct investments group, where he underwrote real estate acquisitions across all major property types and performed asset management functions including new lease underwriting, periodic reporting, valuations, and management of third-party service providers. Mr. Youn holds a B.S. finance from University of Southern California, and he has earned the right to use the Chartered Financial Analyst® designation and is a member of the CFA Institute.
Todd Rosenbluth, Head of ETF and Mutual Fund Research, CFRA
Todd Rosenbluth is Senior Director of ETF and Mutual Fund Research at CFRA where he leads the firm’s holdings-based research efforts. Todd publishes regular thought leadership content on equity and fixed income products, supports the quantitative fund models and interacts with clients. He also serves as a member of CFRA’s Investment Policy Committee. Todd has frequently provided ETF education at Inside ETFs conferences and been quoted in media outlets, such as Barron’s, New York Times and the Wall Street Journal. Todd also held the position of Senior Director of ETF and Mutual Fund Research for S&P Global Market Intelligence.
Prior to joining CFRA, Todd previously served in other financial positions at S&P Global, such as International Mutual Fund Sector Specialist, Large Cap Value and Large Cap Growth Analyst and has served on the Fund Services Asset Allocation Committee. Prior to joining S&P Global in 2001, Todd was managing editor of Value Line Mutual Fund Survey and Senior Large Cap and Small Cap Value Mutual Fund Analyst. He was also a Financial Advisor with Morgan Stanley. Todd holds a B.G.S in Finance from the University of Michigan and an MBA in Finance from New York University.
Chris Kuiper, CFA, Senior Equity Analyst, CFRA
Chris Kuiper is a senior equity analyst at CFRA, conducting fundamental analysis and valuation assessments within the Consumer Finance, Capital Markets, and REITs areas.
Prior to joining CFRA, Chris worked as an analyst for a Large-Cap Value fund, and prior to that worked as a fundamental analyst for Calamos Investments, and a credit analyst for TCF Bank. He previously worked as a research fellow at The Mercatus Center, a research center at George Mason University, where he wrote and published on public policy issues. Chris holds a bachelor’s degree from Dordt College and a master’s degree in economics from George Mason University. Chris Kuiper holds the Chartered Financial Analyst® designation.
Some or all of the non-CFRA speakers in these materials have compensated CFRA for the production of and the right to participate in the discussions captured in these materials. Apart from the production of these materials, CFRA may license certain intellectual property or provide services to, or otherwise have a business relationship with, certain issuers of funds or securities that are the subject of or that have participated in the production of these materials. Irrespective of CFRA’s relationship with any participant in these materials, no part of CFRA’s compensation is tied to any particular CFRA recommendation or rating. The views expressed in these materials by non-CFRA participants do not necessarily reflect the views of CFRA. CFRA makes no warranty or representation that these materials are accurate, timely or complete, and references to any investment, fund or security are not a recommendation to buy, sell, or hold such investment, fund or security. These materials are only for authorized recipients and may not be redistributed or reproduced without the express consent of CFRA. Additional information on the legal disclosures for these materials is available at https://cfraresearch.com/legal/.
Guggenheim Fund Disclosures
The Fund may not be suitable for all investors. • Investing involves risk, including the possible loss of principal. • There are no assurance that any fund will achieve its objective and/or strategy. • The Fund’s investments in real estate securities subject the Fund to the same risks as direct investments in real estate, which is particularly sensitive to economic downturns. • The Fund’s use of derivatives such as futures, options and swap agreements may expose the fund to additional risks that it would not be subject to if it invested directly in the securities underlying those derivatives. • When market conditions are deemed appropriate, the Fund will leverage to the full extent permitted by its investment policies and restrictions and applicable law. Leveraging will exaggerate the effect on net asset value of any increase or decrease in the market value of the Fund’s portfolio. • The more the Fund invests in leveraged instruments, the more the leverage will magnify any gains or losses on those investments. • The Fund’s use of short selling involves increased risk and costs. The Fund risks paying more for a security than it received from its sale. • The Fund’s investments in other investment vehicles subject the Fund to those risks and expenses affecting the investment vehicle. • The Fund’s investments in foreign securities carry additional risks when compared to U.S. securities, due to the impact of diplomatic, political or economic developments in the country in question (investments in emerging markets securities are generally subject to an even greater level of risks). • The Fund may invest in derivative instruments, which may be more volatile and less liquid, increasing the risk of loss when compared to traditional securities. Certain of the derivative instruments are also subject to the risks of counterparty default and adverse tax treatment. • Investing in sector funds is more volatile than investing in broadly diversified funds, as there is a greater risk due to the concentration of the funds’ holdings in issuers of the same or similar offerings. • This fund is considered non-diversified and can invest a greater portion of its assets in securities of individual issuers than a diversified fund. As a result, changes in the market value of a single security could cause greater fluctuations in the value of fund shares than would occur in a more diversified fund. • Short selling involves increased risks and costs. You risk paying more for a security than you received from its sale. This strategy may not be suitable for all investors. • The Fund is subject to active trading risks that may increase volatility and impact its ability to achieve its investment objective. • You may have a gain or loss when you sell you shares. • It is important to note that the Fund is no guaranteed by the U.S. government. • Please read the prospectus for more detailed information regarding these and other risks.
Read the fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the fund’s investment objectives, risks, charges, expenses, and other information, which should be considered
carefully before investing. Obtain a prospectus and summary prospectus (if available) at GuggenheimInvestments.com.
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