HOURSome prices peaked in June, which should open up opportunities for traders using Directorate of the Daily MSCI Real Estate Bull 3X ETF (DRN)…
Meanwhile, the summer usually sees a surge in real estate activity. In this case, they were prices.
“Continuing strong demand pushed the average US home price to an all-time high in June, although the national home buying frenzy cooled slightly as supply increased.” Wall Street Journal Report noted. “Existing home sales rose 1.4% in June from the prior month to a seasonally adjusted 5.86 million annually,” the National Association of Realtors said Thursday. Sales in June were up 22.9% over the previous year. ”
In terms of DRN, the fund aims for daily investment results equal to 300% of the daily performance of the MSCI US IMI Real Estate 25/50 Index. The index is designed to measure the performance of the large, mid-cap and small-cap segments in the aggregate of US stocks that are classified as real estate by the GICS.
Real Seller Market
Competition among potential home buyers is still very high.
As the Wall Street Journal notes, “As more homes enter the market, they are quickly sold out by buyers,” said Robert Frick, corporate economist at the Navy Federal Credit Union.
“Demand is the most important thing,” Frick said. “Increasing inventories will not stop the rise in prices.”
Of course, what goes up must eventually go down. In this case, lower house prices can fuel the other side of the trade through Direxion Daily MSCI Real Est Bear 3X ETF (DRV)…
DRV aims for daily investment results equal to 300% inverse daily performance of the MSCI US REIT Index, which is a free float adjusted market capitalization weighted index composed of REIT stocks listed in the MSCI US Investable Market 2500 Index. DRV invests in swap agreements, futures contracts, short positions, or other financial instruments that collectively provide reverse or short exposure to a leveraged index.
“I don’t believe that you will see such [price] the growth you’ve seen in the past 12 months, ”said Cheryl Palmer, chief executive of construction company Taylor Morrison Home Corp.
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The views and opinions expressed herein are those of the author and do not necessarily reflect the views of Nasdaq, Inc.