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- About Us

• Contact Us
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• Glossary
• Información en Español
  
  - Introduction to Investing - Beginning - Five Questions to Ask Before You Invest
• Understanding Fees
• Asset Allocation
• Assessing Your Risk Tolerance
• Investing on Your Own
• Working with an Investment Professional
• Researching Investments
  
  - Save and Invest - Invest For Your Goals
• How Stock Markets Work
• Investment Products
• What is Risk?
• Role of the SEC
• Glossary
  
  - Investor Alerts & Bulletins
• PAUSE List
• Publications and Research
  
  - Financial Tools - Investment Professional Background Check
• EDGAR - Search Company Filings
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  - Fraud - Kinds of Fraud.
• How to Avoid Fraud.
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  - Spotlight - Crypto Assets.
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  Breadcrumb
  
  1. Home.

2. Introduction to Investing.
3. Investment Products
   
   Main navigation
   
   - Save and Invest - Define Your Goals. - Diversify Your Investments.

• Determine Your Finances. - Gauge Your Risk Tolerance.
• Discover Investment Options.
• Pay Off Credit Cards or Other High Interest Debt.
• Save for a Rainy Day.
• Small Savings Add Up to Big Money.
• Understand What It Means to Invest
  
  - Public Companies.
• Market Participants.
• Types of Orders.
• Kinds Of Brokerage Accounts.
• Stock Purchases and Sales: Long and Short.
• Executing an Order
  
  - Auction Rate Securities.
• Bonds or Fixed Income Products - Bonds.
• Corporate Bonds.
• High-yield Corporate Bonds.
• Municipal Bonds.
• Savings Bonds
  
  - Interval Funds.
• Publicly Traded Business Development Companies (BDCs).
• Publicly Traded Closed-End Funds
  
  - Annuities.
• Indexed Annuities.
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• Variable Life Products
  
  - Alternative Mutual Funds.
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• Exchange-Traded Funds (ETFs).
• Index Funds.
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• Smart Beta, Quant Funds and other Non- Traditional Index Funds.
• Target Date Funds
  
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  - 401( k).
• 403( b) and 457( b).
• IRA (Individual Retirement Accounts)
  
  - How to Submit Comments to the SEC.
• Researching the Federal Securities Laws Through the SEC Website.
• The Laws That Govern the Securities Industry
  
  Real Estate Investment Trusts (REITs)
  
  What are REITs?
  
  Property investment trusts (" REITs") allow to buy large-scale, income-producing real estate. A REIT is a company that owns and generally operates income-producing genuine estate or associated assets. These may include office complex, going shopping malls, apartment or condos, hotels, resorts, self-storage centers, warehouses, and mortgages or loans. Unlike other realty companies, a REIT does not develop property residential or commercial properties to resell them. Instead, a REIT buys and develops residential or commercial properties primarily to run them as part of its own financial investment portfolio.
  
  Why would someone invest in REITs?
  
  REITs supply a way for private investors to make a share of the income produced through business property ownership - without really having to go out and purchase industrial genuine estate.
  
  What types of REITs are there?
  
  Many REITs are registered with the SEC and are publicly traded on a stock market. These are referred to as publicly traded REITs. Others might be signed up with the SEC but are not openly traded. These are called non- traded REITs (likewise referred to as non-exchange traded REITs). This is one of the most important differences among the numerous kinds of REITs. Before purchasing a REIT, you ought to comprehend whether or not it is openly traded, and how this could affect the advantages and threats to you.
  
  What are the benefits and risks of REITs?
  
  REITs offer a method to consist of property in one's investment portfolio. Additionally, some REITs may provide greater dividend yields than some other investments.
  
  But there are some risks, particularly with non-exchange traded REITs. Because they do not trade on a stock exchange, non-traded REITs include unique risks:
  
  Lack of Liquidity: Non-traded REITs are illiquid investments. They usually can not be sold easily on the open market. If you require to offer a property to raise cash quickly, you might not have the ability to do so with shares of a non-traded REIT. Share Value Transparency: While the marketplace cost of a publicly traded REIT is easily available, it can be hard to figure out the worth of a share of a non-traded REIT. Non-traded REITs typically do not offer a quote of their value per share until 18 months after their offering closes. This might be years after you have actually made your financial investment. As an outcome, for a considerable time duration you may be unable to evaluate the worth of your non-traded REIT financial investment and its volatility. Distributions May Be Paid from Offering Proceeds and Borrowings: Investors might be attracted to non-traded REITs by their relatively high dividend yields compared to those of publicly traded REITs. Unlike openly traded REITs, nevertheless, non-traded REITs frequently pay distributions in excess of their funds from operations. To do so, they might use offering profits and loanings. This practice, which is usually not used by openly traded REITs, lowers the worth of the shares and the cash readily available to the company to acquire additional possessions. Conflicts of Interest: Non-traded REITs generally have an external supervisor rather of their own workers. This can cause prospective conflicts of interests with investors. For example, the REIT may pay the external manager considerable fees based on the amount of residential or commercial property acquisitions and assets under management. These charge incentives may not always line up with the interests of shareholders.
  
  How to purchase and offer REITs
  
  You can purchase a publicly traded REIT, which is noted on a major stock market, by buying shares through a broker. You can buy shares of a non-traded REIT through a broker that takes part in the non-traded REIT's offering. You can also purchase shares in a REIT mutual fund or REIT exchange-traded fund.
  
  Understanding fees and taxes
  
  Publicly traded REITs can be acquired through a broker. Generally, you can purchase the typical stock, preferred stock, or financial obligation security of an openly traded REIT. Brokerage costs will apply.
  
  Non-traded REITs are normally offered by a broker or monetary advisor. Non-traded REITs typically have high up-front costs. Sales commissions and in advance offering fees typically amount to roughly 9 to 10 percent of the investment. These expenses lower the worth of the financial investment by a considerable amount.
  
  Special Tax Considerations
  
  Most REITS pay out a minimum of one hundred percent of their taxable earnings to their shareholders. The investors of a REIT are accountable for paying taxes on the dividends and any capital gains they receive in connection with their financial investment in the REIT. Dividends paid by REITs generally are dealt with as normal income and are not entitled to the lowered tax rates on other kinds of corporate dividends. Consider consulting your tax adviser before investing in REITs.
  
  Avoiding fraud
  
  Watch out for anybody who attempts to offer REITs that are not signed up with the SEC.
  
  You can validate the registration of both openly traded and non-traded REITs through the SEC's EDGAR system. You can likewise utilize EDGAR to examine a REIT's annual and quarterly reports in addition to any offering prospectus. For more on how to use EDGAR, please go to Research Public Companies.
  
  You must also inspect out the broker or investment consultant who recommends acquiring a REIT. To learn how to do so, please go to Working with Brokers and Investment Advisers.
  
  Additional info
  
  SEC Investor Bulletin: Real Estate Investment Trusts (REITs)
  
  FINRA Investor Alert: Public Non-Traded REITs - Perform a Careful Review Before Investing
  
  Featured Content
  
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