The role of real estate in a diversified portfolio
Adding real estate to a mixed-asset portfolio offers key diversification and inflation hedging benefits, potentially enhancing the portfolio's risk-adjusted returns.
REAL estate has long been seen as a rich hunting ground for investment returns by institutional and individual investors alike.
Sophisticated institutional investors such as sovereign wealth funds typically adopt a systematic asset allocation approach that explicitly aims to take advantage of the potential diversification benefits of including real estate in a multi-asset portfolio.
By contrast, individual investors often view real estate investments separately from their holdings of stocks, bonds and cash.
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