Why real estate investing is an attractive complement to stocks and bonds
As shown below, there is typically little or negative correlation between real estate, stocks, and bonds. Investing in real estate on top of equities and fixed income can reduce your risk exposure. When the economy is booming, equities are performing well in comparison to bonds and real estate. However, during a bear market in stocks, other assets such as bonds and real estate might produce above average returns. Investing in real estate has the potential to offer lower risk, higher returns, and provide greater diversification....Real estate investment was once considered an alternative investment with huge capital outlay, and therefore only available to the ultra-rich. While owning multiple investment properties directly is still out of reach for most people, there are more avenues for everyone to invest in real estate through real estate funds and real estate investment trusts (REITs).
