I have holdings in both RioCan and CAPREIT, is it better to hold a REIT ETF though?

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Hello, I currently hold both RioCan and CAPREIT. I have been holding for approximately 6-7 months and plan to hold assets in REITS for the foreseeable future. However, as time goes on and as uncertainty keeps going, would it be better to invest my money in something like RIT.TO, which gives me exposure to other REITS in Canada and maintains the 5% yield? Any help is appreciated as to what you would do. Thanks!

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Asked on December 30, 2020 10:03 am
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Hey there.

So, this depends on your overall strategy.

A REIT ETF is going to expose you to practically all of the sectors here in Canada. The bullish industrial sector, and also the bearish commercial/retail sector. So just keep in mind, if you purchase an ETF, you're getting a little bit of everything.

But the one thing I really do like about RIT is the fact that the large majority of its top holdings are either in the industrial or residential segments. This is much better in my opinion than say Vanguards VRE, which has some very high exposure to commercial/office/retail REITs.

In my opinion, you hold one of the best residential REITs in the country in CAPREIT. Your decision to hold a couple of individual REITs rather than an ETF would be your belief that you can identify those that are set to outperform the broader sector moving forward.

But if you wanted to sell it and buy RIT so you can get exposure to a bunch of rock solid residential/industrial REITs here in Canada, that's a viable strategy as well.

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Posted by Dan Kent
Answered on December 30, 2020 10:56 am