Real estate investment trusts reduce portfolio risk and increase stability.
Real estate investment trusts (REITs) are a popular way for investors to access the real estate market without facing liquidity constraints. Real estate investments can help reduce portfolio risk by spreading it across different asset classes. Real estate is less sensitive to economic changes compared to stocks and bonds, making it a defensive investment. Including options like property reserves and lease renewals in valuation models can improve decision-making for real estate investments.