SRET: Avoid The Dividend Yield Trap
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The Global X SuperDividend REIT ETF (SRET) is recommended for a sell due to concerns over its dividend sustainability. Factors such as a high expense ratio, low growth, and high concentration in mortgage and healthcare REITs suggest potential poor performance. Additionally, SRET's top holdings have high payout ratios, negative AFFO growth, and are sensitive to interest rate changes, increasing the risk of dividend cuts.
January 12, 2025 | 1:30 pm
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Global X SuperDividend REIT ETF (SRET) is facing a sell recommendation due to concerns over its dividend sustainability. The ETF's high expense ratio, low growth, and concentration in mortgage and healthcare REITs suggest potential poor performance. Additionally, its top holdings have high payout ratios, negative AFFO growth, and are sensitive to interest rate changes, increasing the risk of dividend cuts.
The article highlights several negative factors for SRET, including high expense ratio, low growth, and high concentration in specific REIT sectors. These factors, combined with high payout ratios and negative AFFO growth of its top holdings, suggest a high risk of dividend cuts. This makes the ETF less attractive to investors seeking stable dividends, likely leading to a negative impact on its stock price.
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IMPORTANCE 90
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