#ETFs have become so popular that the money invested in ETFs has gone up by 3,000% since 2003. As of 2020, there are around 7,000 ETFs out there.
Investing in #RealEstate can serve as an effective #Inflation hedge. Apart from Gold, real estate prices have been the best investment in the last high-inflation environment in the US from 1973-1982.
In the last 30 years, real estate was the second best performing asset class with an annual return of 10.0% - only 0.6% behind stocks. And real estate is on the rise. Just a few months ago, the median #HousePrice in the US exceeded $400,000 for the first time ever. And even better: Goldman Sachs predicts that real estate could go up another 16% this year.
But how can retail investors get exposure to the real estate sector other than buying physical real estate? There are two investment vehicles for this: #REITs and Real Estate ETFs. But what’s the difference between the two?
#REIT is short for real estate investment trust. That’s a trust company that owns and operates properties like houses, apartments, warehouses, malls and hotels. Investors can then buy shares in a REIT - just like a stock or #ETF - and by doing that ultimately own the underlying assets of the REIT, so the properties it manages.
A Real Estate ETF, on the other hand, invests in companies that have exposure to the real estate industry. So it could be the case that a #RealEstateETF only holds REITs. #Real Estate ETFs are a great way to get diversified exposure into the real estate sector if you: (a) don’t own a property, (b) if you aren’t a REIT expert or don't want to do the research to find the best REITs or (c) if you simply want to increase your exposure in real estate because you think that it could generate a higher return than the market.
Today, there are more than 50 Real Estate ETFs out there which makes picking the right one difficult for beginners. That’s why in this video, we will look at 4 of the most interesting and best ETF options. Enjoy!
⏰⏰ Timecodes ⏰⏰ 0:00 Intro 1:00 REIT vs. Real Estate ETF 2:02 Framework 2:41 ETF No 1: RWR 4:03 ETF No 2: ICF 5:47 ETF No 3: VNQI 8:00 ETF No 4: SRET 9:42 Final Thoughts
DISCLAIMER: This video is for educational purposes only and merely cites my own personal opinion. In order to make the best financial decision that suits your own needs, you must conduct your own thorough research and seek the advice of a licensed financial advisor if necessary.
