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Question: 1 / 400

What is one of the core advantages provided by REITs to investors?

Direct ownership of real estate

High volatility

Access to commercial real estate

REITs, or Real Estate Investment Trusts, offer investors the advantage of access to commercial real estate without the need for substantial capital that would typically be required for direct ownership. By pooling capital from numerous investors, REITs can invest in a diversified portfolio of income-generating properties, including office buildings, shopping centers, and apartment complexes. This structure allows investors to gain exposure to the real estate market and benefit from its potential returns while enjoying liquidity, as shares of publicly traded REITs can be bought and sold on major stock exchanges. Additionally, REITs often provide dividends derived from rental income, adding to their appeal as an investment vehicle.

In contrast, direct ownership of real estate involves significant capital, barriers to entry, and ongoing management responsibilities that may not be feasible for many investors. High volatility doesn't align with the generally stable nature of real estate investments, and increased management control is typically more associated with direct ownership rather than the indirect ownership structure provided by REITs.

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Increased management control

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