As we emerge from the pandemic shutdown in 2021, we believe investors should prepare for a more cyclical rebound with a better economic growth environment. Jeremy Schwartz provides a solution for investors seeking to gain more cyclical exposure in their portfolios.
Remember Detlef Schrempf? He’s the last basketball star awarded the NBA’s Sixth Man of the Year Award twice consecutively. The sixth man is the player who enters the game from the bench, while five others start the game. To me, REITs are like the Detlef Schrempf of the capital markets, because they play a critical role in asset allocation but often get overshadowed by the proverbial Michael Jordans of the world.
The search for income has dominated many investors’ minds over the last year. In the absence of higher-yielding fixed income assets, one way investors have met their income needs is through equity markets. One unique corner of the equity universe that offers both yield and diversification and that we believe should not be overlooked is global real estate.
Japan is back. After being practically the worst-performing equity market in the developed world in the first half of 2016 on the back of a strengthening yen, Japan has rallied strongly from its post-Brexit bottom in anticipation of a large, creative fiscal package.