Recently, a new investment product in the market has gradually become hot, which is reits fund. This fund is an investment product on the surface, but it has very different characteristics in essence, so please read on.

What is a real estate investment trust fund?

Reits fund refers to real estate trust and investment fund, which is an important means of real estate securitization. Reits funds are managed by specialized agencies, and the investment targets include large commercial properties with stable income, including shopping malls, office buildings, warehouses, industrial land, hotels, medical places, and residential buildings in core areas. Simply put, this fund is to let everyone become the owner of real estate investment.

Reits fund is a mature investment product abroad, which can directly convert low-liquidity non-securities real estate investment into securities assets in the capital market, so there are generally three types:

1 Equity reits, which directly invest in real estate, and convert the rental and transaction income into dividends to be paid to investors.

Mortgage reits, which mainly rely on lending to real estate developers to make profits, are similar to intermediaries, and pay the interest generated by mortgage loans to investors as a source of income.

3 hybrid reits are a mixture of the above two investment methods, that is, both renting and lending.

Generally speaking, reits fund is more professional and more liquid than our personal investment in real estate, so this fund can join our investment portfolio and reduce our investment risk.