Investing in real estate is a fantastic way to diversify your portfolio with an asset class that differs from stocks and bonds. Certain ETFs such as the iShares UK Property UCITS ETF allow investors to gain exposure to the real estate market in a straightforward and cost-effective way.
In this guide, we show you How to Invest in iShares UK Property UCITS ETF commission-free and provide you with the crucial information you need to know to make an effective investment decision.
- 1 How to Invest in iShares UK Property UCITS ETF
- 2 Choose an ETF Broker
- 3 Research iShares UK Property UCITS ETF
- 4 How to Buy iShares UK Property UCITS ETF on eToro
- 5 How to Invest in iShares UK Property UCITS ETF – Conclusion
- 6 eToro – Best Broker to Invest in iShares UK Property UCITS ETF – 0% Commission
- 7 FAQs
If you’re interested in investing in the iShares UK Property UCITS ETF, we recommend using eToro. eToro allows you to invest in their ETF range commission-free and for as little as $50 per trade.
The steps below show you how to invest in iShares UK Property UCITS ETF in as little as ten minutes:
- Step 1: Open an account with top iShares UK Property UCITS ETF broker eToro
- Step 2: Fund your account through one of the available deposit methods
- Step 3: Search for the iShares UK Property UCITS ETF using eToro’s search bar
- Step 4: Open a position in the iShares UK Property UCITS ETF – minimum of $50 (around £36)
- Step 5: Keep track of your position and collect dividend payments
You’re now officially an investor in the iShares UK Property UCITS ETF – all without paying a penny in commissions!
Choose an ETF Broker
One of the most crucial components when researching how to invest in iShares UK Property UCITS ETF is choosing a reliable broker. However, with so many brokers on offer in the marketplace today, it can seem a daunting prospect to analyse and select from many options.
Not to worry – in this section, we will discuss two of the best stock brokers available when it comes to investing in the iShares UK Property UCITS ETF.
1. eToro – Overall Best Broker for Investing in iShares UK Property UCITS ETF
Our recommended broker when it comes to investing in the iShares UK Property UCITS ETF is eToro. Commonly thought of as one of the most popular brokers, eToro boasts over 20million users from a large number of countries. In addition to this vast user base, eToro is also regulated by the FCA and the FSCS in the UK – meaning that they ensure the highest level of protection for their users’ money and data.
One of the main reasons eToro is a great choice when investing in the iShares UK Property UCITS ETF is its inexpensive fee structure. With eToro, you can invest in their ETF range without having to pay any commissions whatsoever. This contrasts with some other brokers, which can charge between 1-3% commission when placing an investment – meaning that traders who are active in the market can rack up fees quickly.
Furthermore, if you’re looking to construct a portfolio of various assets, then eToro has got you covered. They currently offer over 2000 stocks to trade, alongside an extensive selection of currencies and commodities. Furthermore, they even allow cryptocurrency trading. In addition to this, eToro also provides a revolutionary CopyTrader feature, which allows users to copy the trades of other users on the platform. This is ideal for beginner traders who are looking to learn from more experienced market participants.
Finally, eToro also ensures a quick and easy signup process, meaning you can have an account open and ready to invest in under ten minutes. When you fund your account, you will have a range of deposit options available, such as credit/debit card, bank transfer, or e-wallet. What’s more, all of these methods are free – eToro does not charge any deposit fees!
67% of retail investor accounts lose money when trading CFDs with this provider. Your capital is at risk.
2. Capital.com – Cost-Effective CFD Broker with Leverage
If you’re looking for an alternative broker to eToro, we would also recommend Capital.com. Founded back in 2016, Capital.com are regulated by both the FCA and CySEC, which gives investors confidence that their personal data and capital are safe.
Capital.com primarily focus on CFD trading, allowing you to purchase contracts with values based on an underlying asset – for example, you could buy acontract based on the price of a stock or an ETF. The great thing about CFDs is that they allow you to trade with leverage, meaning you can essentially boost your position size. Capital.com offer leverage of up to 20:1 for many stock indices and even offer leverage of up to 5:1 for individual stocks.
In terms of fees, Capital.com do not charge a commission – but they do charge a fee through their spread. The spread is the difference in price between the buy and sell prices that a broker offers; this difference is essentially the ‘fee’ they charge. Usually, this spread is minimal; however in certain market conditions, it can grow higher.
Finally, Capital.com allow you to deposit as little as $20 to fund your account – perfect for new traders who wish to use a low amount initially before depositing more. Also, Capital.com do not charge any deposit fees, withdrawal fees, monthly account fees, or inactivity fees.
71.2% of retail investor accounts lose money when spread betting and/or trading CFDs with this provider.
The iShares UK Property UCITS ETF is one of the best property funds to invest in for a whole host of reasons. In this section, we dive into this ETF in detail, covering all of the bases so that you have the information you need to make an informed investment decision.
What is iShares UK Property UCITS ETF?
The iShares UK Property UCITS ETF is an exchange-traded fund that invests in several UK real estate companies and REITs, with the investment objective of providing diversified exposure to the real estate sector within the UK. This best UK REIT ETF is provided by iShares, which is an element of BlackRock’s product range. BlackRock is an investment management company based in New York and is currently the world’s largest asset manager with around $8.67 trillion of assets under management! With a NAV of just over £695 million, this fund is one of the best GBP-denominated ETFs for investing in the real estate industry.
As the iShares UK Property UCITS ETF is an exchange-traded fund, it works by pooling capital from various investors and then investing in a basket of securities to replicate the performance of a benchmark index. ETFs such as this are traded on multiple stock exchanges such as the LSE or NASDAQ, with investors being able to invest into the fund through either the issuer themselves or through an FCA-regulated broker such as eToro. As the share price of the ETF fluctuates, investors would experience positive or negative returns depending on the direction of price movements.
In terms of the iShares UK Property UCITS ETF, the type of assets this fund invests in are all related to the UK real estate sector. As the ETF invests in a selection of real estate companies and real estate investment trusts (REITs), investors will tend to benefit most when this sector experiences positive growth across the board. Capital gains and current income through dividend payments are the two main ways investors will receive a return on their investment through this ETF.
Finally, the iShares UK Property UCITS ETF charges an annual fee referred to as the fund’s expense ratio. This ETF requires an expense ratio of 0.40% of your investment each year, which will help cover the fund’s annual operating expenses. So, if you invested £1000 in this ETF, your yearly ongoing charge would amount to £4.
iShares UK Property UCITS ETF Price
Now that you’ve got an idea of what the iShares UK Property UCITS ETF is and how it works let’s take a look at its current price and potential future performance. After a large crash in February and March of 2020 due to the volatility brought about by the Coronavirus pandemic, the fund has recovered remarkably well and is currently heading back to previous highs. The highs from mid-February last year sit around the 672 price point and would represent an excellent milestone for this fund to breach if it can do so this year.
67% of retail investor accounts lose money when trading CFDs with this provider.
Currently, this ETF is consolidating around the 585 region. Still, with a solid upward trend on various timeframes, we could see this continue over the coming months and push price back to previous highs. Fundamental factors could help boost price too, most notably the increasing nature of house prices. A recent report by the ONS stated that house price growth in the UK rose sharply towards the end of last year to the highest rate it has been since 2016.
If we continue to see solid growth in the UK real estate sector, this fund’s price will likely continue to trickle upwards towards previous highs. This would be great news for investors in this fund, as it would mean solid capital gains and even potential for dividend growth. If you’re interested in this fund, you can even save yourself some money on commissions by investing with eToro – they offer commission-free investing on the iShares UK Property UCITS ETF with a minimum investment of only $50.
Is iShares UK Property UCITS ETF a Good Investment?
So, by now, you might be wondering if the iShares UK Property UCITS ETF is a good investment for you. There are many key benefits of investing in this fund that will appeal to investors of various types and risk tolerances, making it one of the best investment funds to add to investment portfolios. Most notably, it provides cost-effective exposure to the UK real estate sector, allowing investors to profit from the growth of companies operating within this industry.
Through this exposure, investors can earn a return on the money they invest in this ETF. Taking a look at the performance in previous years, it’s clear to see that the iShares UK Property UCITS ETF does have the potential to produce market-beating returns, generating a remarkable 29.56% in 2019 alone. It’s important to note that the fund has experienced a negative return in three of the past six years; however, each time the fund produced a negative return, it bounced back strongly the following year with an even bigger positive return.
Another reason the iShares UK Property UCITS ETF is a good investment is that it provides investors with a passive income stream with a solid price yield. Currently, this ETF offers a yield of 1.79% each year, distributed every quarter. This yield is significantly higher than the various ISAs available on the market, which are usually capped around the 1.1% range. So, when you combine this yield with the additional capital gains, it makes a good investment option for many people.
The iShares UK Property UCITS ETF is also one of the best ETFs for diversification. Typically, real estate is not highly correlated with other asset classes such as equities, meaning that an investment in an ETF such as this will help diversify your portfolio if it is more equity-based. In turn, a more diversified portfolio will help optimise your portfolio’s risk/reward profile, leading to less overall risk and a better chance at total returns.
iShares UK Property UCITS ETF Dividend History
As touched on in the previous section, the iShares UK Property UCITS ETF provides a passive income stream through quarterly dividend payments to investors. Currently, this ETF is delivering an annual yield of 1.79% to investors, which is a solid level of current income. This has risen over the past year from 2020 levels, which were considerably lower due to the fund producing a negative return brought about through market volatility.
The most recent dividend payment came in February, where the fund distributed £0.03 per share to investors. This is around the same level paid last February, just before the crash in price occurred. However, looking at previous dividend payouts, it can be seen that the level of yield has decreased since 2018 when the fund was offering a yield of around 2% to investors on an annual basis.
With the iShares UK Property UCITS ETF recovering well over the past year, we could see dividends return to the levels they were at between 2017 and early 2020. Dividend yields tend to be affected by an asset’s performance; if an investment does well, it’ll have more capital to distribute back to investors, thereby increasing yield. Assuming this ETF continues its upwards trajectory, it may lead to an increased price yield and therefore a more attractive prospect for investors looking to get involved in dividend investing.
iShares UK Property UCITS ETF Top Exposures and Sectors
As mentioned previously, the iShares UK Property UCITS ETF is primarily exposed to the real estate sector in the UK. To generate this exposure, the fund invests in a selection of listed real estate companies and REITs that are domiciled within the United Kingdom. Some of the fund’s top holdings are as follows:
- SEGRO REIT PLC – 19.08%
- LAND SECURITIES GROUP REIT PLC – 8.36%
- BRITISH LAND REIT PLC – 7.76%
- UNITE GROUP PLC – 5.84%
- DERWENT LONDON REIT PLC – 5.50%
The above allocations represent a snapshot of the type of companies this ETF invests in. These companies and trusts derive most of their income from areas related to the real estate sector, such as generating cash flow from financing properties or the sale of land to property developers.
The majority of real estate equities that the fund invests in are mid-cap and constitute a blend of growth and value. Furthermore, the iShares UK Property UCITS ETF will appeal to investors concerned with ESG factors, as this ETF does not place capital in any companies that are morally or ethically unsustainable as stated by the MSCI.
In addition to equities, the fund invests in Real Estate Investment Trusts (REITs). These companies differ from typical real estate companies as they pool money from various investors (similar to the best mutual funds) and then use that money to finance income-generating real estate projects. These projects could include the construction of apartments, hotels, office buildings, warehouses, and many other property types. In return for their investments, REITs will typically receive income through rent payments received from the properties.
Finally, in terms of geographic exposure, the vast majority of this ETF’s assets are based in the UK. Approximately 1.36% of the fund’s assets are based in the Channel Islands (Jersey), with 0.86% of assets being held as cash or other derivatives.
iShares UK Property UCITS ETF Key Facts
If you’re looking for a quick snapshot of the key facts related to the iShares UK Property UCITS ETF, then look no further. The table below showcases the most important information about this fund, allowing you to understand its current situation at a glance.
|Market||London Stock Exchange|
|Net Assets (£ Millions)||695|
|Number of Holdings||40|
|Asset Class||Real Estate|
|Price Yield (last 12 months)||1.79%|
|YTD Return (as of 19/04/2021)||8.44%|
If you’ve heard enough and wish to invest in the iShares UK Property UCITS ETF, then this section of the guide will show you exactly how to do so. The steps below provide a walkthrough of how to invest in this ETF using FCA-regulated broker eToro – without having to pay a penny in commissions.
Step 1: Open an Account
The first thing you need to do is open an account with eToro. Navigate to their website on your browser and click the ‘Join Now’ button in the top right. Then simply provide a valid email address, and choose a username and password.
Step 2: Verify your ID and Address
After creating your account, you will have to provide some relevant personal details and verify your ID and address. With eToro, this can all be completed online and usually only takes a few minutes. Upload some proof of ID (a copy of your driver’s license or passport) and proof of address (a copy of a bank statement or utility bill). Once uploaded, eToro will then verify the documents.
Step 3: Fund your Account
After you have been verified, the next step is to fund your eToro account. You can do this through various methods such as credit/debit card, bank transfer, or e-wallet. If you’re looking to invest as quickly as possible, we recommend using a credit or debit card as the funds will arrive instantly.
Step 4: Search for the iShares UK Property UCITS ETF
Once you have made a deposit, click into the search bar at the top of the screen and enter the fund’s name or ticker symbol (IUKP). In the drop-down menu that appears, click on the fund’s name, and click ‘Trade’ on the next screen.
Step 5: Invest in iShares UK Property UCITS ETF
An order box similar to the image below will now appear. All you have to do is enter the amount you’d like to invest (minimum of $50), double-check everything is correct, and click ‘Set Order’.
Congratulations! You’ve just invested in the iShares UK Property UCITS ETF – commission-free!
As the UK real estate market keeps growing, ETFs such as the iShares UK Property UCITS ETF are becoming increasingly popular thanks to retail and institutional investors wishing to gain exposure to the sector. Through ETFs like this one, it is quick and easy to diversify your portfolio and create a passive income stream in the process.
If you’ve made up your mind and are looking to invest in the iShares UK Property UCITS ETF, we’d recommend using eToro to facilitate your investment. eToro allows you to invest in this ETF (and many others) without having to pay any commissions whatsoever. Also, eToro’s account opening process is quick and easy, and you can be ready to invest in an ETF in as little as ten minutes!
67% of retail investor accounts lose money when trading CFDs with this provider. Your capital is at risk.
What is the iShares UK Property UCITS ETF?
This exchange-traded fund invests in a wide range of listed real estate companies and REITS, aiming to provide investors with diversified exposure to the UK real estate industry.
How do I invest in the iShares UK Property UCITS ETF?
You can either invest directly with the fund provider or through an FCA-regulated broker such as eToro. We recommend the latter because the minimum initial investment is much less, and you can also invest commission-free.
Is the iShares UK Property UCITS ETF safe?
No investment is 'safe' per se; however this ETF is much safer than investing in a handful of real estate companies of REITS on their own. This is because the iShares UK Property UCITS ETF is inherently diversified, so if some of the companies within the fund experience a downturn, there's a good chance that others will experience an upturn which will help to compensate for any losses incurred.
Does the iShares UK Property UCITS ETF pay a dividend?
Yes, it does – this ETF pays a quarterly dividend, distributed in February, May, August, and November. The current annual yield that the ETF pays out is 1.79%.
What sort of returns can I make with the iShares UK Property UCITS ETF?
This ETF has shown more impressive past performance than many market indices over recent years, returning a remarkable 29.40% in 2019. Furthermore, when this ETF does make a positive return, it is often in the double digits. However, the ETF has made a negative return in two of the past five years, so be aware of the potential volatility before investing.