No. of Recommendations: 16
The risks from interest rates, legislation changes, and bear market concerns are hardly unique to reits. But I think you are specifically asking about my heavy concentration in reits.

Well, for one thing, reits are more than just one industry. They encompass a single asset class, but an extremely broad one which serves virtually every industry and consumer. So I consider it to be less concentrated than perhaps it may seem.

As for the interest rates, my experience is that reits are not hurt any more by rising interest rates than equities as a whole, which does not only seem to be empirically true, but also makes sense. Why is the value of a dollar of dividends devalued by rising interest rates any more than a dollar in price appreciation?

And I think a bear market for reits is less likely than a bear market in other equities because of current valuations. In effect, we have already had a reit bear market and (oh, please!) we are coming out the other side.

I am comfortable with reits right now. Not so much with the broader market. I am also comfortable in my belief that my posts will not cause anyone else to push all their chips into VNQ, so my conscience is clear.
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