Kiplinger\'s Personal Finance 02.2020

02/2020 KIPLINGER’S PERSONAL FINANCE 31

A Holistic Bet

on Housing

This fund invests in all aspects

of the real estate market.

HOUSING REPRESENTS THE LARGEST
slice of the average American’s annual
spending, at 33%. Yet the few housing-
related exchange-traded funds avail-
able to investors overlook huge chunks
of the market. Some invest in builders
of single-family homes and home-
improvement stores but forgo multi-
family investments such as apartment
real estate investment trusts. ETFs
that do hold these REITs, meanwhile,
often leave out the homebuilders
and DIY shops. With the HOYA CAPITAL
HOUSING ETF (SYMBOL HOMZ), you can in-
vest in all three categories, and more.
HOMZ is offered by investment
adviser Hoya Capital Real Estate. The
ETF tracks the Hoya Capital Housing
100 index, made up of 100 stocks. The
ETF puts 30% of assets in homebuild-
ers and construction stocks, and an-
other 30% in real estate operators such
as apartment REITs. It then allocates
20% to home-improvement retailers,
furniture stores and the like, and the
last 20% to home financing, technol-
ogy and services companies.
Low mortgage rates, slower-growing
home prices and a glut of millennials
hitting their prime home-buying years
bode well for the housing industry.
HOMZ provides access to an array
of businesses poised to benefit.
The fund, launched in March 2019,
has no track record to speak of. And
assets, although growing well, are still
small. That makes HOMZ speculative,
but its approach is promising. Since
its debut, the ETF has returned 17.6%,
compared with 12.4% for Standard &
Poor’s 500-stock index over the same
period. KYLE WOODLEY
[email protected]

Housing-Related ETFs Ranked by assets

Rank/Fund Symbol

March 19–

Nov. 30# 3 yrs.

Assets

(mi ll i o n s)

Expense

ratio

Annualized total return*

1.iShares U.S. Home Construction ITB $1,242 33.7% 41.4% 19.1% 0.42%

2.SPDR S&P Homebuilders XHB 839 22.0 30.7 11.7 0.35

3.iShares Residential Real Estate REZ 607 14.2 19.2 13.4 0.48

4.Invesco Dynamic Building & Construction PKB 117 26.3 28.8 7.7 0.60

5.Hoya Capital Housing HOMZ 9 17.6 N/A N/A 0.45

S&P 500 STOCK INDEX 12.4% 16.1% 14.9%

As of November 30, 2019. *Assumes reinvestment of dividends and capital gains; three-year returns are annualized. #Since HOMZ

inception. N/A=not available; fund not in existence for the entire period. Expense ratio is the percentage of assets claimed annually

for operating a fund. SOURCES: Hoya Capital Real Estate, Morningstar, Yahoo Finance.

$29

28

27

26

25

(^24) April
2019
May June July Nov.
SECTOR BREAKDOWN: Housing Hodgepodge
KEY FACTS
SYMBOL: HOMZ
RECENT PRICE: $29
ASSETS: $8.6 million
START DATE: March 19, 2019
STOCK HOLDINGS: 100
AVG. PRICE-EARNINGS RATIO: 18
AVG. MARKET VALUE: $12 billion
PERFORMANCE
THE ETF’s YIELD
Income-friendly REITs
offset low-yielding
growth companies
in the fund.

1. 9

%

Hoya Capital Housing ETF

36 %

2 % RE AL E S TAT E

BASIC

MATERIALS

2 %

OTHER

3 %

CONSUMER

STAPLES

12 %

FINANCIAL

SERVICES

10 %

INDUSTRIALS 35 %

CONSUMER

DISCRETIONARY

TOP FIVE HOLDINGS

Account for 11% of Assets

HOME DEPOT (HD)

LOWE’S (LOW)

NVR (NVR)

EQUITY LIFESTYLE PROPERTIES (ELS)

PARK HOTELS & RESORTS (PK)

2.9%

2.9%

1.6%

1.6%

1.6%

Weekly closing prices

ETF SPOTLIGHT

Aug. Sept. Oct.

1 yr.