The new value index allows investors to gain real estate exposure in an innovative way
Barclays today announced the launch of a new investible real estate index designed jointly with economist Professor Robert Shiller. The Shiller Barclays US REIT Value Index seeks to identify undervalued US REIT (Real Estate Invest Trusts) stocks drawing upon Professor Shiller’s property expertise and Barclays’ index capability. The Shiller Barclays US REIT Index aims to provide an alternative to market capitalisation weighted indices and offers enhanced exposure to real estate markets by tracking the performance of liquid REITs.
The index aims to strike a balance between allocating a higher weight to REITs identified by the index methodology as being most undervalued, whilst maintaining liquidity, tradability and diversification.
REITs are investment vehicles in real estate that are available to many investors and are commonly traded on major stock exchanges. They derive most of their revenue from ownership or financing of rental properties, such as apartment building, hotels and shopping malls. REITs have grown in popularity mainly due to their liquid exposure to property markets, yield and diversification benefits.
Professor Robert Shiller commented: “Long-term investors should maintain a widely diversified portfolio, while retaining a value tilt. Real estate is one of the major asset classes that belong in that portfolio. The Barclays team and I have worked hard to develop a sensible value-based index that allows investors to measure and access the real estate market for this purpose.”
Fabien Labouret, Global Head of EFS Investment Strategies at Barclays added: “We are delighted to continue our partnership with Professor Shiller following the success of the Shiller Barclays CAPE Sector Indices. Professor Shiller has global recognition for his work in value investing and drawing upon his deep knowledge and expertise has been invaluable in developing this innovative REIT index.”
