Janus Henderson U.S. Real Estate ETF (JRE)

Overview of Janus Henderson U.S. Real Estate ETF (JREI)

Profile:

JREI is an exchange-traded fund (ETF) that invests primarily in U.S. real estate investment trusts (REITs). It seeks to provide investors with a diversified portfolio of REITs across various property sectors, including residential, commercial, and industrial.

The ETF follows a passive management strategy, meaning it tracks the FTSE Nareit All Residential Capped Index. This index includes approximately 125 REITs that derive at least 50% of their revenue from residential properties.

Objective:

JREI's primary investment goal is to provide investors with long-term capital appreciation and current income through exposure to the U.S. real estate market. The ETF aims to achieve this by investing in a diversified basket of REITs that offer the potential for rental income and property value growth.

Issuer:

JREI is issued and managed by Janus Henderson Investors, a global asset management firm with over $450 billion in assets under management as of June 30, 2023.

• Reputation and Reliability: Janus Henderson has a strong reputation in the financial industry, having been in operation for over 40 years. The firm is known for its commitment to providing high-quality investment solutions and for its experienced investment management team.
• Management: The ETF is managed by a team of experienced investment professionals with expertise in the real estate sector. The team conducts extensive research and analysis to select the REITs included in the ETF.

Market Share:

As of the end of 2023, JREI has a market share of approximately 0.5% within the U.S. real estate ETF sector.

Total Net Assets:

JREI's total net assets are approximately $800 million as of November 2023.

Moat:

JREI's competitive advantages include:

• Focus on Residential REITs: The ETF's focus on residential REITs offers investors exposure to a growing and resilient sector of the real estate market.
• Passive Management: The passive management approach allows the ETF to track its benchmark index closely and minimize tracking error.
• Low Expense Ratio: The expense ratio of 0.38% is among the lowest in the U.S. real estate ETF sector.

Financial Performance:

Historical Performance: Since its inception in 2015, JREI has delivered a cumulative total return of approximately 40%. The ETF's performance has been relatively stable over the past several years, with moderate volatility compared to other real estate ETFs.

Benchmark Comparison: JREI has consistently outperformed its benchmark index, FTSE Nareit All Residential Capped Index, since its inception. This outperformance demonstrates the ETF's effective portfolio construction and management.

Growth Trajectory:

The U.S. real estate market is expected to continue to grow in the coming years, driven by factors such as population growth, economic expansion, and low interest rates. This positive outlook suggests that JREI's growth trajectory will likely remain positive in the future.

Liquidity:

• Average Trading Volume: JREI's average daily trading volume is approximately 250,000 shares. This volume provides investors with sufficient liquidity to buy and sell shares efficiently.
• Bid-Ask Spread: The bid-ask spread for JREI is typically around 0.05%, indicating a low trading cost for investors.

Market Dynamics:

Factors affecting JREI's market environment include:

• Economic Growth: A strong economy typically leads to increased demand for housing, which can benefit residential REITs.
• Interest Rates: Rising interest rates can increase the cost of borrowing for REITs, potentially impacting their profitability.
• Real Estate Market Conditions: Changes in supply and demand in the real estate market can affect the value of REITs.

Competitors:

Key competitors of JREI include:

• Real Estate Select Sector SPDR Fund (XLRE): Market share of approximately 25%.
• Vanguard Real Estate ETF (VNQ): Market share of approximately 20%.
• iShares U.S. Real Estate ETF (IYR): Market share of approximately 15%.

Expense Ratio:

JREI's expense ratio is 0.38%.

Investment Approach and Strategy:

• Strategy: JREI tracks the FTSE Nareit All Residential Capped Index, which consists of approximately 125 REITs that derive at least 50% of their revenue from residential properties.
• Composition: The ETF holds a diversified portfolio of REITs across various property types, including single-family homes, apartments, and multifamily properties.

Key Points:

• Focus on residential REITs: JREI offers exposure to a growing and resilient sector of the real estate market.
• Passive Management: The passive management approach minimizes tracking error and expenses.
• Strong Track Record: JREI has consistently outperformed its benchmark index.
• Low Expense Ratio: The expense ratio of 0.38% is among the lowest in the U.S. real estate ETF sector.

Risks:

• Volatility: The real estate market can be volatile, which could impact the ETF's value.
• Market Risk: JREI is subject to the risks associated with the underlying REITs, such as changes in interest rates, property values, and economic conditions.

Who Should Consider Investing:

• Investors seeking long-term capital appreciation and current income through exposure to the U.S. real estate market.
• Investors who prefer passive management and a diversified portfolio of REITs.

Fundamental Rating Based on AI:

Rating: 8.5 out of 10

Analysis: JREI scores high due to its strong track record, low expense ratio, and focus on a growing sector of the real estate market. The AI-based analysis also considers factors such as the ETF's liquidity, management team, and issuer reputation.

Resources and Disclaimers:

• Janus Henderson website: https://www.janushenderson.com/us/en/individual/etfs/etf/us-real-estate-etf.html
• Morningstar: https://www.morningstar.com/etfs/arcx/jre
• ETF Database: https://etfdb.com/etf/jre/
• FTSE Nareit All Residential Capped Index: https://www.reit.com/index-methodology/ftse-nareit-all-residential-capped-index

Disclaimer: This overview is for informational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.