Who Invests in REITs?
-Individual investors of all legal ages can invest in REITs directly or through REIT mutual funds. -Other typical buyers of REITs are exchange traded funds, pension funds, endowments.
Why Should I Invest in REITs?
REITs are total return investments.
They typically provide high dividends plus the potential for moderate, long-term capital appreciation.
Long-term total returns of REIT stocks are likely to be somewhat less than the returns of higher risk, high-growth stocks and somewhat more than the returns of lower risk bonds.
REITs are required by law to distribute each year to their shareholders at least 90 percent of their taxable income. Thus, REITs tend to be among those companies paying the highest dividends.
The dividends come primarily from the relatively stable and predictable stream of contractual rents paid by the tenants who occupy the REIT’s properties. Because rental rates tend to rise during periods of inflation, REIT dividends tend to be protected from the long-term corrosive effect of rising prices.
In SUmmary,
REITs offer investors:
• Portfolio diversification, which reduces risk
• Current, stable dividend income
• High dividend yields
• Dividend growth that has consistently exceeded the rate of consumer price inflation
• Liquidity: shares of publicly traded REITs are readily converted into cash because they are traded on the major stock exchanges
• Professional management: REIT managers are skilled, experienced real estate professionals
• Oversight: Independent directors of the REIT, independent analysts, independent auditors, and the business and financial media monitor a publicly traded REIT’s financial reporting on a regular basis. This provides investors with a measure of protection and more than one barometer of the REIT’s financial condition.
• Disclosure obligations: REITs whose securities are registered with
the authorities are required to make regular disclosures, including
quarterly and yearly financial reports.
-Individual investors of all legal ages can invest in REITs directly or through REIT mutual funds. -Other typical buyers of REITs are exchange traded funds, pension funds, endowments.
Why Should I Invest in REITs?
REITs are total return investments.
They typically provide high dividends plus the potential for moderate, long-term capital appreciation.
Long-term total returns of REIT stocks are likely to be somewhat less than the returns of higher risk, high-growth stocks and somewhat more than the returns of lower risk bonds.
REITs are required by law to distribute each year to their shareholders at least 90 percent of their taxable income. Thus, REITs tend to be among those companies paying the highest dividends.
The dividends come primarily from the relatively stable and predictable stream of contractual rents paid by the tenants who occupy the REIT’s properties. Because rental rates tend to rise during periods of inflation, REIT dividends tend to be protected from the long-term corrosive effect of rising prices.
In SUmmary,
REITs offer investors:
• Portfolio diversification, which reduces risk
• Current, stable dividend income
• High dividend yields
• Dividend growth that has consistently exceeded the rate of consumer price inflation
• Liquidity: shares of publicly traded REITs are readily converted into cash because they are traded on the major stock exchanges
• Professional management: REIT managers are skilled, experienced real estate professionals
• Oversight: Independent directors of the REIT, independent analysts, independent auditors, and the business and financial media monitor a publicly traded REIT’s financial reporting on a regular basis. This provides investors with a measure of protection and more than one barometer of the REIT’s financial condition.
• Disclosure obligations: REITs whose securities are registered with
the authorities are required to make regular disclosures, including
quarterly and yearly financial reports.
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