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Effect of Real Estate Investment Trusts Portfolio Structure on the Market Performance

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  • İbrahim Sırma

Abstract

Real Estate Investment Trusts (REITs) are the companies that manage portfolio by investing at least fifty-one percent of the assets they own in real estate assets. REITs must be a public company.in the same way, twenty percent of the share certificates must be traded on the stock exchange. The most important reason for the provision of this status to REITs by Regulatory institutions is to enable investors to be partners in the returns of the projects in the REIT portfolio through the stock exchange. Thus, investors who want to get rid of the sale of real estate or rent income invest in the shares of REITs. Theoretically, investors expect the value of the shares to be priced over the earnings of the company's assets. However, investment instruments traded in the market are affected by systematic and non-systematic risk factors. The purpose of this study was to investigate whether the shares of REITs were affected more by company assets or by the market. In this study, the effect of the increase in the assets of REICs traded between 2007 and 2017 on stock returns was investigated. This research was done with a panel data analysis. As a result of the analysis, it is concluded that the increase in the assets of REITs is not as effective as the factors affecting the whole market.

Suggested Citation

  • İbrahim Sırma, 2019. "Effect of Real Estate Investment Trusts Portfolio Structure on the Market Performance," Alphanumeric Journal, Bahadir Fatih Yildirim, vol. 7(1), pages 25-36, June.
    • Handle: RePEc:anm:alpnmr:v:7:y:2019:i:1:p:25-36
    DOI: http://doi.org/10.17093/alphanumeric.418874
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    References listed on IDEAS

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    1. Richard J. Buttimer & David C. Hyland & Anthony B. Sanders, 2005. "REITs, IPO Waves and Long-Run Performance," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 33(1), pages 51-87, March.
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    More about this item

    Keywords

    Market Value; Panel Data Analysis; Real Estate Investment Trusts;
    All these keywords.

    JEL classification:

    • C40 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - General

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