Quote: (05-18-2013 09:09 PM)WestCoast Wrote:
Yes find a better asset class correlated to single family homes.
Mortgage reits are about as good as it gets.
Then we take opposite investment positions on that stock/fund and see who is right over a NTM period... otherwise just GTFO
Sadly there aren't many investments that substitute for residential housing - I wish there were! Years ago, there was an ETN by Metro Markets that tracked residential housing prices, but it did not survive.
I will tell you this: I would NOT advise someone who wants to invest in real estate to buy a mortgage REIT as a substitute! The mortgage REIT could have all kinds of tranche repayment risk that a homeowner never has to contend with. Also, because it is so liquid, it tends to converge with equity prices in a downtown.