Page 13 - IreitEbook

According to its findings, adding REITs

to an already diversified portfolio

resulted in nine less basis points (0.09%)

of risk. And it generated 33 basis points
ADDITIONAL INCOME
(0.33%) of additional return.
THROUGH DIVIDEND
Those percentages might not
PAYOUTS
seem like big deals when stated in a

sterile report. But don’t discount them

in practice. The compound annual
We’ll discuss stability further in the next
total return on the FTSE-Nareit All
segment. First though, since we’ve already
Equity REITs index in the 25-year period
covered diversification, let’s address the
through January 2019 was over 10.3%,
other D-term incentive for investing in REITs:
a full percentage point higher than the
dividend income.
total return on the S&P 500 over the

same period.
Dividend income is one of the biggest and
In short, holding onto REITs can
best reasons to include REITs in your portfolio.
make a big difference in your long- term

financial health.
Historically speaking, real estate investment
That’s because real estate
trusts offer higher yields than either U.S.
represents one of the three
Treasuries or the S&P 500 Index. Just as long
fundamental investment asset classes,
as they feature conservatively leveraged
the other two being stocks (aka,
balance sheets alongside well-located and
equities) and bonds. Each one of those
competitively managed assets, REITs can open
categories involves its own unique
up extremely attractive opportunities for
cycles, influences, and outcomes. So
anyone looking for additional annual income or
while bonds might have a bad year, real
further funds to invest.
estate could be booming. And while

bonds are booming, stocks might lag.

It’s all about properly balancing

risk and reward to achieve the most

worthwhile, profitable, stable returns.