State Street Real Estate Select Sector SPDR ETF

XLRE

Market cap $7.87B

The Real Estate Select Sector SPDR Fund (NYSEARCA:XLRE | XLRE Price Prediction) is the cheapest way to own the REIT slice of the S&P 500, with an expense ratio of just 8 basis points and a portfolio that pays out income four times a year.

The REIT sector roared back into positive territory after a very brutal March. REITs averaged a remarkable 8.9% April gain and now have a +6.31% year-to-date total return. Small-cap REITs (+11.35%) soared in April as large caps (+9.05%) and mid caps (+8.13%) also saw strong gains. Micro caps (+4.49%) were also in the black but badly lagged. 91.33% of REIT securities had a positive total return in April.

REITs underperformed in recent years. But they are beating the market so far into 2026. We expect this trend to continue. Here's why.

Surging oil prices and hotter inflation reports reignited rate-hike concerns, sending Treasury yields to one-year highs as the Iran conflict remained stalemated despite the highly anticipated Trump-Xi summit.

REITs may be emerging from a brutal multi-year downturn. Falling supply and stabilizing rates could drive recovery. Valuations and buyouts signal strong upside ahead.

Much like 2025, investors and advisors alike are continuing to seek out new sources of diversification as we continue through 2026. One approach is to gain targeted exposure to specific sectors that are underrepresented in traditional core ETFs.

The Real Estate Select Sector SPDR Fund (NYSEARCA:XLRE | XLRE Price Prediction) trades around $45 with roughly $7.71 billion in assets and a trailing distribution yield of 3.4%.

REITs are finally shaking off their bear thesis. Oversupply is turning into a future tailwind. AI may push more capital toward real assets.

The Federal Reserve has already trimmed its policy rate by 0.75 percentage points over the past year, leaving the upper bound at 3.75%.

Monthly dividend stocks can be fantastic passive income machines. I take a look at two of the best monthly dividend machines in the market today. I detail why one is a buy and why the other one is not.