Friday, May 22, 2009

Gaining Diversity Through REITs and Real Estate Mutual Funds

Many people who are investing in real estate investment trusts (REITs) and real estate mutual funds think that by purchasing these types of investment portfolios they have created a completely diversified investment plan for themselves.

By their very nature, REITs and real estate mutual funds are diverse. Instead of purchasing one stock or bond at a time, by purchasing the REIT or real estate mutual fund you will be purchasing into a number of stocks, bonds and other offerings at the same time. But this still may not be as diverse as you think it is.

While in theory this sounds like a great idea, you really need to know what is inside those REITs and real estate mutual funds to find out if you have in fact diversified. For many people who purchase REITs and real estate mutual funds, they find out later that all the diversity they thought they had was really a lot of very similar REITs that had their money all in essentially the same place with often 7 or 8 of the top 10 investments being in the exact same places.

More Than a Name

When you are first looking for REITs and real estate mutual funds, there is more than the name of the fund you should be looking at. Don’t get me wrong, the name is important. The name will let you know what company is managing the portfolio and that is vital information to know. When you find out who is in charge of the fund, you can invest according to how you believe that person will be able to do with your money in their hands.

But there is more you need to look at than just the name on the portfolio. You also need to look at all the names inside of it. While you may have purchased a number of REITs with very different names, you may be surprised to look inside of them and see many of the same stocks, bonds and other portfolio offerings inside that account. This is just the way the system works.

So, as you begin your search for new REITs to purchase, or are sorting through your portfolio, look at more than just the main name. Open those investments and see where your money is really being put.

Diversity is Key

What you want to look for is a variety of investments in those REITs and real estate mutual funds.

There are a couple of things to look for here:

Region – You want investments that are in more than one region. Any region of the country can have a bad couple of months. If all of your investments are focused in this region when it happens, you may not like to see what happens to your investments.

Sector – In addition to making sure your money is diversified around the country or world, you want to make sure all of your financial eggs are not in one part of the real estate sector basket. This means you want to put money in financing, construction, and management instead of all in one place.

The more diverse you make your investments, the more chance if one area has a hard time, your other investments will hold you strong through them.

This article was written by Earl E. Bird, spokes person for the, a site dedicated to educating Real Estate Investors on how to invest in Real Estate Mutual Funds to diversify their investing portfolio. Learn more at

Thursday, February 26, 2009

Buying REITs Online is Easy Even with Media Hype

If you are new to the world of investing, it may be quite a scary world to get into.

Let's start by looking at the media hype. Those who are new to investing generally only have a couple of sources for their information – the newspaper, TV and Internet. Reading any of the stories about investing lately is more like reading the obituary page than anything else, quite depressing. It may have you even thinking that you should just put your money in a piggy bank and avoid investing altogether.

But, there is another option. If you understand the investing market a little more, you would know that while many markets are struggling, some of them are in a situation where you should consider buying them to see great returns down the road. One of these markets is real estate.

So, now is the time to do your research and make sure you know what to buy and when to buy it. But where can you get that research? Well you could go all over the place putting together bits and pieces to try and get a full picture of the economic climate or save yourself a lot of hassle by going to one place, is a website that specializes in the real estate market. Their name even has the term REIT in it, which stands for real estate investment trust, one of those real estate investment options you are going to be looking into.

Through their website you can start with the basics. It will explain the REITs and other real estate investment options on the market in the education area of the site. Once you have a better understanding of the options out there you can move on to the other areas.

One of the ones you will want to keep an eye on is the latest REIT news feed. This is a feed that will bring in the newest and latest information on the market. Instead of you having to hunt it all down, it's a one-stop shopping option for information.

Once you know what is going on in the market and how to invest, you can even make your real estate investment trust purchases on since they are a full service investing real estate broker.

Once the purchase has been made, just relax and watch, as they will also help you keep an eye on your portfolio and track its progress.

You can also take advantage of many of the other tools they have on the site. For example, they have a blog that gives you a little more insight from the inside of the industry into what types of things may be happening in the sessions and months ahead that you may want to keep your eyes open for. This is a great way to get a jump on trends and make sure you are buying in time to reap the rewards of a smart investment decision.

Research and Buy REITs Online

Are you still of the old fashioned school where you think the best way to invest in stocks, REITs, bonds or mutual funds is to call your broker and ask him to make a buy for you? Why is that? By now, you should have realized that we have come a long way and the Internet is a way that you can take on these investments for yourself and have peace of mind doing so.

Many people are reluctant to take investing their own account into their own hands through the Internet. Their reasons vary from thinking they don't know enough about their specialty market to that they can't make the same kinds of buys as a broker to thinking that their broker knows more than they do and will make sure they get in on a good deal. Let's look at each of these for a minute.

I don't know enough about my market.

If you are one of the people who think you just don't know enough about your market to matter, that's only because you aren't trying to. If you invest in REITs, for example, there are wonderful websites that allow you to learn everything you would ever need to know, plus keep on top of what is happening right now, like

Learning enough about your market to make wise decisions only takes a few minutes a day to do and can take you a long way in the profitability of your investment portfolio.

I can't make the same types of buys as my broker.

Think again. While your broker may have a really fancy computer system on his desk that he uses to make your purchases happen for you, chances are he is really using a program that is just as simple as one you could use to make the purchase. For example, is a complete brokerage firm of real estate investing that will allow you to buy and sell, as you need to, from the comfort of your own computer.

My broker knows more and will make sure I get good deals.

Unless you are sinking millions of dollars a year into your accounts, you’re not big enough for a broker to call you. If your broker hears about a great buy possibility, he is going to call his most prized clients first. Those are not the friendliest ones, but the ones who stand the chance to make him the most money. After all, this is business. This means you are likely not going to get that phone call and are going to miss out on the deal.

On the other hand, when you sign up with a company like you see the news stories that are going to impact the market as they come through and also be able to take a peek into the minds of the analysts on their blog to get the inside track on what is happening in your investment world. Then you can make the decision to act right away and reap the rewards.