By Index Funds Staff

The first exchange-traded fund that tracks a Real Estate Investment Trust (REIT) index began trading on the American Stock Exchange on Friday, 2/2/2001. The new ETF was launched by Barclays Global Investors (BGI) and is called the iShares Cohen & Steers Realty Major Fund (trading symbol: ICF).

The fund will track a a modified cap-weighted index of 30 REITs, and has an expense ratio of 0.35%.

"The Cohen & Steers Realty Majors Portfolio Index consists of the 30 largest and, in our view, the best capitalized and best managed REITs in America," said Martin Cohen, President of Cohen & Steers.

Performance of Cohen & Steers Realty Majors Index since inception (12/31/1998) to 2/2/2001.



Source: Cohen & Steers

Sector Breakdown of C&S Realty Majors Index
Office	26.9%
Apartment	26.1%
Regional Mall	12.6%
Office/Industrial	10.9%
Industrial	9.5%
Shopping Center	5.5%
Self Storage	4.5%
Health Care	3.0%
Manufactured Home	0.9%

Source: Cohen & Steers

Graphic courtesy of Cohen & Steers

REITs have been garnering more attention recently as a simple way to diversify a portfolio with real estate. BGI is not alone in bringing an ETF to market that represents a basket of REITs - State Street is preparing to launch an ETF that tracks the Wilshire REIT Index. In addition, BGI last year launched an iShares fund that tracks the Dow Jones Real Estate Index (trading symbol: IYR), which seeks to track real estate industry securities.

Index	Yearly performance in 2000
Cohen & Steers Realty Major	31.03%
Wilshire REIT	30.70%
S&P REIT	29.00%
Morgan Stanley REIT	26.81%
NAREIT Equity REIT	26.37%
Dow Jones Real Estate Securities	19.80%
S&P 500	-9.10%
Dow Jones Industrial	-4.85%

Sources: Morningstar, Cohen & Steers

To learn more about REITs and their role in asset allocation, please check out an excellent article by Larry Swedroe.

02/05/2001