REITs have performed well thus far in 2016, despite the increasingly hawkish tone of the Federal Reserve. The iShares U.S. Real Estate ETF (IYR) is up 4.3 percent year-to-date, outperforming the S&P 500 by over a percentage point. Steve Brown, portfolio manager for the American Century Real Estate Fund (REACX) , said REITs will continue to perform well, even after the Fed finally raises interest rates. 'Generally speaking in the U.S. demand is greater than supply for most property sectors,' said Brown. The American Century Real Estate Fund is up five percent thus far in 2016, according to Morningstar. The $1.5 billion fund has returned an average of 10.2 percent annually over the past five years, outpacing 86 percent of its rivals in Morningstar's real estate category. The fund sports a trailing twelve month yield of 2.4 percent, according to Morningstar. Brown is bullish on Equinix (EQIX) , which has already seen its shares jump 21 percent so far in 2016. He said the data center REIT is capitalizing on large tech players moving to the cloud. 'They own the infrastructure so companies like Amazon (AMZN) , Google (GOOGL) and Microsoft (MSFT) are using their system for their e-commerce and cloud computing needs,' said Brown. 'Their growth is very strong, better than the economy in general.'
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