From a small northwestern observatory…

Week before last, I wrote about the performance of our REIT portfolio versus the S&P during this market crash.  I wanted to bring you up to date on that today, and I’ll continue to update you in the future.

First, as a reminder, I own and manage ACCRE, a private REIT fund made up entirely of real estate shares.  Over the past three years, we’ve out-performed the S&P about 2.5 times.  Further, because we’re only partially correlated with the S&P (about 45%), we get a high degree of diversification in volatile markets.  Real estate is generally considered to be a “safe harbor” in troubled times.  This is no exception.

I’ve tracked the S&P since the peak on February 19, and normalized both the S&P and ACCRE so they’ll fit on the same graph:

As you can see, from the peak, the S&P was down about 29.18% at the close yesterday.  (It is up 0.70% on the day as I write this).  ACCRE has tracked the S&P in parallel, but with a significantly lower down-trend.  Hence, we’re only down 13.47% since February 19.

Naturally, hindsight is 20-20, and the perfect spot would have been in cash on February 18.  That said, I’ve weathered more than a few bear markets in my several decades (see my post on March 11), and we seem to have come through all of them nicely.