Leverage in Real Estate Portfolios: Impact on Diversification and Efficiency.
Real estate can play a crucial role in a diverse investment portfolio. By analyzing different types of real estate assets and considering leverage and management fees, it was found that locally dependent real estate properties are generally better for diversification than globally dependent ones. The study showed that the use of leverage impacts how real estate contributes to overall portfolio efficiency, and different types of real estate can be used for different investment goals.