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FREL vs IYR
Which ETF would AI Choose? Fidelity MSCI Real Estate Index ETF (FREL) vs. iShares U.S. Real Estate ETF (IYR)
Key Takeaways
- Both funds offer broad U.S. real estate exposure, but FREL tracks the MSCI USA IMI Real Estate 25/25 Index, while IYR tracks the Dow Jones U.S. Real Estate Capped Index, creating meaningful differences in diversification and concentration.
- FREL is dramatically cheaper, with a net expense ratio of 0.08% versus 0.37% for IYR, a structural cost advantage that compounds over time.
- FREL holds roughly twice as many securities (about 128–133) as IYR (about 60–64), extending into small- and mid-cap real estate names.
- IYR is the older and more liquid vehicle, with substantially larger assets and average daily trading volume, appealing to institutional and high-frequency traders.
- Both are top-heavy in healthcare, industrial, and data-center real estate investment trusts (REITs), so their sector momentum tends to move in tandem.
- Tickeron AI Verdict: FREL.
Introduction
Real estate ETFs remain a focal point for investors navigating shifting interest rate expectations and evolving commercial property fundamentals. The Fidelity MSCI Real Estate Index ETF (FREL) and the iShares U.S. Real Estate ETF (IYR) are two of the most widely followed passive funds in this space, yet they are not identical. They compete directly for the same investor dollar, but they deliver that exposure through different indexes, cost structures, and portfolio compositions. For anyone weighing a core U.S. real estate allocation, understanding the structural and relative positioning of these two funds is essential.
Fidelity MSCI Real Estate Index ETF (FREL) Overview
FREL is a passively managed fund that seeks to track the MSCI USA IMI Real Estate 25/25 Index, which represents the U.S. real estate sector across the entire market-capitalization spectrum. The "25/25" designation refers to capping rules that limit the weight of any single security. The fund typically holds roughly 128 to 133 securities, extending beyond large caps into mid- and small-cap real estate companies.
Its top holdings are dominated by large-cap REITs, including Welltower (WELL), Prologis (PLD), Equinix (EQIX), American Tower (AMT), Simon Property Group (SPG), Digital Realty Trust (DLR), Public Storage (PSA), and Realty Income (O). Sector allocation skews toward healthcare, industrial, data-center, and telecom-tower REITs. With a net expense ratio of just 0.08%, FREL is among the lowest-cost ways to access diversified U.S. real estate exposure.
iShares U.S. Real Estate ETF (IYR) Overview
IYR is a passively managed, non-diversified fund that seeks to track the Dow Jones U.S. Real Estate Capped Index, a market-capitalization-weighted benchmark of U.S. real estate equities. Launched in 2000 by BlackRock, it is one of the longest-running real estate ETFs and typically holds around 60 to 64 securities, concentrating its portfolio in large-cap names.
Its top holdings overlap heavily with FREL, including Welltower (WELL), Prologis (PLD), American Tower (AMT), Simon Property Group (SPG), Equinix (EQIX), Digital Realty Trust (DLR), Realty Income (O), and Public Storage (PSA). The primary structural differences are cost and breadth: IYR carries a 0.37% expense ratio and a more concentrated, large-cap-heavy portfolio, while offering superior liquidity with higher average daily trading volume and a larger asset base.
Industry and Thematic Backdrop
Both funds sit squarely within the U.S. real estate sector, a group whose fortunes are heavily tied to interest rate policy, credit conditions, and structural shifts in how space is used. Healthcare REITs have benefited from demographic tailwinds tied to an aging population, while industrial and data-center REITs continue to draw support from e-commerce growth and surging demand for cloud and artificial-intelligence computing capacity. Conversely, traditional office and retail segments face ongoing pressure from hybrid work and changing consumer behavior.
Recent market cycles have seen real estate act as a rate-sensitive asset class, with valuations sensitive to long-term Treasury yields. Capital flows into the sector have been mixed as investors weigh resilient fundamentals in specialized REITs against financing costs and property-level concerns. For both FREL and IYR, these macro forces are the dominant drivers of sector performance.
Performance and Positioning Comparison
Because their top holdings overlap substantially, FREL and IYR have generally tracked each other closely over recent weeks and months, with differences driven primarily by composition and fees rather than divergent strategies. FREL's inclusion of smaller-cap real estate names gives it a slightly broader tilt toward companies that can be more sensitive to domestic economic momentum, while IYR's large-cap concentration tends to anchor its relative positioning around mega-cap, higher-quality REITs.
From a cost perspective, FREL's 0.08% expense ratio gives it a persistent, compounding advantage over IYR's 0.37%, which is a meaningful headwind for a fund that otherwise mirrors the same core holdings. In terms of liquidity, IYR retains the edge, which matters for large institutional trades and tighter bid-ask spreads.
AI Screener
Tickeron's AI Screener is an AI-powered stock and ETF discovery tool designed to help traders and investors filter the market based on technical patterns, fundamentals, trends, volatility, and AI-driven signals. Users can scan thousands of stocks and ETFs using customizable filters such as industry, market capitalization, technical indicators, price patterns, and performance metrics. By automating the screening process, the tool helps identify trade ideas, trending stocks, breakout candidates, and market opportunities far more efficiently than manual research. Explore the AI Screener to refine your own ETF comparison and uncover actionable opportunities.
Tickeron AI Verdict
Based on observable structural factors, Tickeron's AI would likely favor FREL over IYR in the current environment. The decisive advantages are cost efficiency and diversification: FREL delivers nearly identical core sector exposure at roughly one-fifth of the expense ratio, while its broader holdings base reduces single-name concentration risk. Although IYR offers superior liquidity and a longer track record, those benefits accrue mainly to short-term and institutional traders rather than long-term buy-and-hold investors. Given comparable sector momentum and trend consistency, the probabilistic edge favors the lower-cost, more diversified FREL.
Disclaimer
The information on this webpage is provided for general informational and educational purposes only and is not intended as investment advice, a recommendation to purchase or sell any security, or an offer or solicitation related to investments. It does not consider your personal financial situation, goals, or risk profile, and all investing carries inherent risks, including the possibility of losing your entire investment. For more details, please review our full disclaimer.
To compare these two companies we present long-term analysis, their fundamental ratings and make comparative short-term technical analysis which are presented below. The conclusion is FREL is a Hold and IYR is a Buy.
FREL's RSI Indicator ascending out of oversold territory
The RSI Indicator for FREL moved out of oversold territory on October 08, 2026. This could be a sign that the stock is shifting from a downward trend to an upward trend. Traders may want to buy the stock or call options. The A.I.dvisor looked at 28 similar instances when the indicator left oversold territory. In 25 of the 28 cases the stock moved higher. This puts the odds of a move higher at 89%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 12, 2026. You may want to consider a long position or call options on FREL as a result. In 72 of 92 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 78%.
The Moving Average Convergence Divergence (MACD) for FREL just turned positive on October 09, 2026. Looking at past instances where FREL's MACD turned positive, the stock continued to rise in 38 of 45 cases over the following month. The odds of a continued upward trend are 84%.
FREL moved above its 50-day moving average on October 29, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for FREL crossed bullishly above the 50-day moving average on November 02, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 13 of 17 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 76%.
Following a +1.33% 3-day Advance, the price is estimated to grow further. Considering data from situations where FREL advanced for three days, in 248 of 300 cases, the price rose further within the following month. The odds of a continued upward trend are 83%.
Bearish Trend Analysis
The Stochastic Oscillator has been in the overbought zone for 2 days. Expect a price pull-back in the near future.
The 50-day moving average for FREL moved below the 200-day moving average on October 26, 2026. This could be a long-term bearish signal for the stock as the stock shifts to an downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where FREL declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 84%.
FREL broke above its upper Bollinger Band on November 02, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for FREL entered a downward trend on October 19, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
IYR's RSI Oscillator recovers from oversold territory
The RSI Indicator for IYR moved out of oversold territory on October 08, 2026. This could be a sign that the stock is shifting from a downward trend to an upward trend. Traders may want to buy the stock or call options. The A.I.dvisor looked at 25 similar instances when the indicator left oversold territory. In 22 of the 25 cases the stock moved higher. This puts the odds of a move higher at 88%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on October 12, 2026. You may want to consider a long position or call options on IYR as a result. In 66 of 86 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 77%.
The Moving Average Convergence Divergence (MACD) for IYR just turned positive on October 09, 2026. Looking at past instances where IYR's MACD turned positive, the stock continued to rise in 36 of 47 cases over the following month. The odds of a continued upward trend are 77%.
IYR moved above its 50-day moving average on October 29, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for IYR crossed bullishly above the 50-day moving average on November 02, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 13 of 18 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 72%.
Following a +1.44% 3-day Advance, the price is estimated to grow further. Considering data from situations where IYR advanced for three days, in 255 of 309 cases, the price rose further within the following month. The odds of a continued upward trend are 83%.
Bearish Trend Analysis
The Stochastic Oscillator has been in the overbought zone for 1 day. Expect a price pull-back in the near future.
The 50-day moving average for IYR moved below the 200-day moving average on October 22, 2026. This could be a long-term bearish signal for the stock as the stock shifts to an downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where IYR declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 85%.
IYR broke above its upper Bollinger Band on November 02, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
The Aroon Indicator for IYR entered a downward trend on October 19, 2026. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
| FREL | IYR | |
|---|---|---|
| RSI ODDS (%) | 2 days ago 89% | 2 days ago 88% |
| Stochastic ODDS (%) | 2 days ago 81% | 2 days ago 88% |
| Momentum ODDS (%) | 2 days ago 78% | 2 days ago 77% |
| MACD ODDS (%) | 2 days ago 84% | 2 days ago 77% |
| TrendWeek ODDS (%) | 2 days ago 82% | 2 days ago 82% |
| TrendMonth ODDS (%) | 2 days ago 80% | 2 days ago 79% |
| Advances ODDS (%) | 3 days ago 83% | 3 days ago 83% |
| Declines ODDS (%) | 8 days ago 84% | 8 days ago 85% |
| BollingerBands ODDS (%) | 2 days ago 85% | 2 days ago 89% |
| Aroon ODDS (%) | 2 days ago 76% | 2 days ago 79% |
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FREL and
Correlation & Price change
A.I.dvisor indicates that over the last year, FREL has been closely correlated with CUBE. These tickers have moved in lockstep 75% of the time. This A.I.-generated data suggests there is a high statistical probability that if FREL jumps, then CUBE could also see price increases.
| Ticker / NAME | Correlation To FREL | 1D Price Change % | ||
|---|---|---|---|---|
| FREL | 100% | -0.07% | ||
| CUBE - FREL | 75% Closely correlated | -0.02% | ||
| KIM - FREL | 74% Closely correlated | -0.32% | ||
| EXR - FREL | 73% Closely correlated | +0.16% | ||
| SPG - FREL | 72% Closely correlated | +0.16% | ||
| O - FREL | 72% Closely correlated | -0.14% | ||
More | ||||
IYR and
Correlation & Price change
A.I.dvisor indicates that over the last year, IYR has been closely correlated with HIW. These tickers have moved in lockstep 78% of the time. This A.I.-generated data suggests there is a high statistical probability that if IYR jumps, then HIW could also see price increases.