There are several asset classes you can choose for your portfolio: Cash, stocks, bonds, real estate, commodities and currencies to name just a few broad categories. The key idea here is that different asset classes have different levels of risk and return, and the way you mix them in your portfolio will play a key role in determining your overall risk and return.
ON KAPITALLA list of real estate companies, and a list of Real Estate Investment Trusts (REITs) Wondering how real estate companies performed over the last year? Use the Compar-O-Matic Use the News Viewer to read the latest news impacting the housing market
Indirect Ways of Buying Real Estate: Buying real estate directly can be expensive, but there are cheaper, indirect ways to gain exposure to this market. Real Estate Investment Trusts (REITs) trade like a stocks on the major exchanges, and invest in real estate directly on behalf of their investors. In other words, by investing in a REIT you are buying a slice of a real estate portfolio without the associated costs.
Here are a few Exchange Traded Funds (ETFs) you can use to gain exposure to real estate investments. iShares Dow Jones US Real Estate (IYR): This fund tracks the performance of the real estate sector of the U.S. equity market, as represented by the Dow Jones U.S. Real Estate Index. SPDR Dow Jones REIT (RWR): The fund replicates the performance of the Dow Jones Wilshire REIT Index, which tracks companies involved in commercial real estate. The fund seeks to provide an effective exposure of the United States real estate investment trust (REIT) market.
iShares Cohen & Steers Realty Majors (ICF): ICF tracks the performance of large, actively traded U.S. real estate investment trusts (REITs), as represented by the Cohen & Steers Realty Majors Index. Because this fund focuses on larger REITs, it tends to be less risky when compared to funds that invest in smaller REITs.