June 8, 2019
Here is the article.
Step Three: Add real-estate investment trusts
Professionally managed commercial real estate, in the form of real-estate investment trusts (REITs), can reduce risk and increase return. From 1972 through 2013, REITs compounded at 10.4%, almost the same as the S&P 500 (10.5%). As you can see from the pie chart, if REITs made up 12% of this portfolio (20% of the equity slice), the annual return would have been 8.8%, but with less risk: A standard deviation of 10.4%.
Professionally managed commercial real estate, in the form of real-estate investment trusts (REITs), can reduce risk and increase return. From 1972 through 2013, REITs compounded at 10.4%, almost the same as the S&P 500 (10.5%). As you can see from the pie chart, if REITs made up 12% of this portfolio (20% of the equity slice), the annual return would have been 8.8%, but with less risk: A standard deviation of 10.4%.
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