The 10 Best Investments: Nuveen Real Estate Income Fund (JRS)
I’m a big believer that if you own your own home, you already have a big exposure to real estate and don’t need anymore.
However, if we’re talking about the 10 best investments of the next 10 years, I think it’s important that real estate is a part of the list; it’s just too big a part of the U.S. economy.
The Nuveen Real Estate Income Fund (NYSE:JRS), a closed-end fund, has roughly 470 million in total assets, $145 million of which is leveraged; 63% is invested in equity REITs, and 34% is invested in REIT preferred stocks. All told, the fund holds 82 stocks, and the wide majority of those belong to large-cap companies. Perhaps most impressive is the fund’s roughly 9% distribution rate — which is the kind of high-caliber income you can expect from mixing REITs and their preferreds.
The three portfolio managers who manage JRS have been with the fund since April 2006. Over the past 10 years, the fund’s market price has averaged a 3.3% annual return while its assets have appreciated by 2.9%, which suggests the fund over the past decade has traded at a premium to its net asset value.
Currently, however, JRS trades at 1.3% discount to NAV, making now a reasonably good time to buying this closed-end fund.
JRS charges 1.33% in expenses, or $133 annually on every $10,000 invested.