By: Marc Sperling
Everyone talks about Commercial Real Estate as the potential “next shoe to drop.” Many have shorted the REITs in the face of strong price action on this belief. The REITs have been one of the weaker sectors since the March lows; however, they have not paid the shorts. Today, with some negative news that SLG may have trouble selling its 485 Lexington Avenue property, the REITs are getting hit pretty hard.
With the breakdown today, we now have a level to short against in the IYR.
Since the sector is somewhat illiquid to trade, I will be looking to buy some SRS, with a stop below the $8 level. DRN is an interesting ETF to short and if you are looking at stock-specific trades, I like SPG, VNO, and MAC as potential short setups.
