“According to our latest compilation of data from Zacks Investment Research, the real estate sector has the lowest percentage of analyst Buys (32%) and the highest percentage of Sells (11%) of the 50 or so sectors we track. And it was with this extremely negative analyst backdrop in mind that I just took another look at what has been a favorite exchange traded fund (ETF) of mine over the past six months—iShares Dow Jones US Real Estate (NYSEArca: IYR),”  Bernie Schaeffer Reports From The MoneyShow.

Schaeffer goes on to say, “The first thing I’d note is that IYR has outperformed the Standard & Poor’s 500 Index (SPX) by more than 25% since March 2009. It always grabs my attention when a stock or a sector that is strongly outperforming the SPX is despised by the analyst community, as this means that the favorable price action has been accomplished with little or no analyst support and that further gains could be fueled by analyst upgrades as they begin to capitulate.

“Speaking of price action, IYR has been in solidly bullish mode since it broke out above its 200-day moving average in July 2009. Of particular interest to me is the all-time high at $95 set in February 2007. Stocks that decline sharply from their peaks often have difficulty on the way back up at a level equal to half the former high—in this case, at $47.50—and it’s no shock to me that IYR’s highest close on its rally off the March 2009 bottom has been at $47.43 (on December 28, 2009). While this “half-high” still represents an overhead resistance “speed bump,” IYR’s upside could be pretty spectacular if it’s taken out, as there appears to be little overhead resistance until $55-$60. Short interest on IYR has climbed steadily, often an indicator of negative sentiment. While these big short positions could represent hedges to long positions in the individual stocks comprising this ETF, I find it interesting that short interest on IYR has steadily grown for many years,” Schaeffer Reports.

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Here are some details on the iShares Dow Jones US Real Estate ETF (IYR):

 The investment (IYR) seeks investment results that correspond generally to the price and yield performance of the Dow Jones U.S. Real Estate Index. The fund generally invests at least 90% of assets in securities of the underlying index and depositary receipts representing securities of the underlying index. It may invest the remainder of assets in securities not included in the underlying index but which BGFA believes will help the fund track underlying index, and in futures contracts, options on futures contracts, options and swaps as well as cash and cash equivalents, including shares of money market funds advised by BGFA. It is nondiversified.

TOP 10 HOLDINGS ( 41.11% OF TOTAL ASSETS)

Company Symbol % Assets Annaly Capital Management Inc C (NLY) 3.8 AvalonBay Communities, Inc. Com (AVB) 2.65 Boston Properties, Inc. Common (BXP) 3.68 Equity Residential Common Share (EQR) 3.67 HCP, Inc. Common Stock (HCP) 3.52 Host Hotels & Resorts, Inc. Com (HST) 2.92 Public Storage Common Stock (PSA) 4.15 Simon Property Group, Inc. Comm (SPG) 9.01 Ventas, Inc. Common Stock (VTR) 2.71 Vornado Realty Trust Common Sto (VNO) 5

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