This article was originally published on ETFTrends.com.
By Kara Marciscano, CFA
Associate, Research
Megatrends have been among the key focal points for investors in recent years, as they offer growth opportunities in the context of the structural changes that are shaping our world. To support the proliferation and continued functioning of a range of megatrends, very specific types of infrastructure must be in place.
For this reason, WisdomTree believes that investing in real estate infrastructure with a focus on powering the growth of many different megatrends, or the ‘New Economy,’ represents an exciting investment opportunity at the junction of thematic investing and real estate.
The WisdomTree New Economy Real Estate Fund (WTRE) provides exposure to both megatrends and the diversification potential associated with the real estate sector:
Collaboration for Expertise in Thematic Investing within Real Estate
To capture this exciting thematic investment opportunity within New Economy real estate, WisdomTree is collaborating with CenterSquare Investment Management LLC (CenterSquare), a global investment manager focused on actively managed public and private real estate, equity, and private real estate debt strategies. CenterSquare’s management team has an average of 30+ years of experience, with expertise across real assets and the liquidity spectrum.
WTRE seeks to track the price and yield performance, before fees and expenses, of the CenterSquare New Economy Real Estate Index (CSNERE).
CSNERE provides differentiated sector exposures relative to broader real estate benchmarks,1 and specifically provides more exposure to technology-focused sectors.
Sector Breakdown: CenterSquare New Economy Real Estate Index vs. Benchmarks
For definitions of terms in the chart above, please visit the glossary.
WTRE—Capturing Opportunities in Real Estate Created by Technological Disruption
WisdomTree believes that technology-focused real state exposure represents an increasingly important component of the future real estate market.
Built into WTRE’s strategy is a screen that targets companies with high technology exposure and strong balance sheets. The companies in WTRE must pass the following filters:
For definitions of terms in the chart above, please visit the glossary.
WTREs weighting mechanism is designed to form a portfolio of securities that are technology focused and have attractive growth and valuation characteristics relative to the investable universe. The index methodology assigns a higher weight to companies with (1) stronger technology scores, (2) higher earnings, dividend and cash growth (3) and more attractive valuations relative to their levels of cash flow, earnings and dividends.