Abstract
This study provides evidence on the investment performance of real estate relative to bonds and common stocks in the U.S. Using quarterly total return data over the years 1978-2012, the analyses show that, over this period, on a risk-adjusted basis real estate was the top performing asset class, outperformed both bonds and stocks. Real estate, in the Eastern U.S., was the top performer, outperforming both bonds and stocks. The results also show that real estate provided a partial hedge against actual and expected inflation, and that, in combinations with bonds and stocks, it made up a major share of optimal portfolios constructed for various target returns within the Markowitz optimization framework
Department
Accounting and Finance
Publication Date
1-1-2016
Journal Title
Investment Management and Financial Innovations
Publisher
Business Perspectives
Digital Object Identifier (DOI)
Document Type
Article
Recommended Citation
Etebari, A. “Real Estate as a Portfolio Risk Diversifier,” Investment Management and Financial Innovation, 13 (2), 2015, 45-52