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Subject:  Re: Portfolio Advice/Help Date:  3/23/2019  3:47 PM
Author:  aleax Number:  92633 of 96307

I have some money in REITs and commodities, and if I had to do it over, would not do that. I thought I could both reduce volatility and possibly increase the upside, and they both have been a 20 year drag.

Likely true for commodities (see note at end of post), but not for REITs in an indexed approach, looking at Total Returns (assumes dividend reinvestment, thus a better approximation of what one could do in an IRA or the like, rather than in a taxable account).

S&P 500 Total Returns index from :
Start 1999, 1379.84; End 2018, 5383.63. Ratio of 3.90, CAGR over 20 years 7.0%.

FTSE NAREIT total returns index from
Start 1999, 1099.09; End 2018, 6852.72. Ratio of 6.23, CAGR over 20 years 9.58%.

In other words, with dividend reinvestment, the indexed total of REITs in North America has materially outperformed that of large-cap North America stocks (S&P 500) over the last complete 20-years period. Most definitely not "a drag".

(Note: I can't easily get exact numbers for commodity indices going back 20 years, but just eyeballing historical charts e.g. at it does appear that, despite an enormous spike in-between, GSCI is pretty close to flat over the last 20 years, thus would most certainly have been quite a drag compared to either FTSE NAREIT or S&P 500).
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