The.gov means it's official. Federal federal government websites often end in.gov or.mil. Before sharing sensitive information, ensure you're on a federal government site.

The website is secure. The https:// guarantees that you are connecting to the official website and that any information you supply is encrypted and transmitted safely.

Auxiliary Header

- About Us

• Contact Us
• Follow Us
• Glossary - Información en Español
  
  - Introduction to Investing - Getting Started - Five Questions to Ask Before You Invest
• Understanding Fees
• Asset Allocation
• Assessing Your Risk Tolerance
• Investing on Your Own
• Dealing 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
• Fund Analyzer
• Retirement Ballpark E$ timate.
• Social Security Retirement Estimator
  
  - Compound Interest Calculator.
• Calculadora de distribución mínima requerida.
• Calculadora de interés compuesto.
• Savings Goal Calculator.
• Calculadora de objetivo de ahorro.
• Required Minimum Distribution Calculator.
• College Savings Calculator
  
  - Fraud - Kinds of Fraud.
• How to Avoid Fraud.
• Resources for Victims
  
  - Submit Questions and Complaints. and Mediation Clinics
  
  - Spotlight - Crypto Assets.
• Director's Take.
• HoweyTrade.
• Never Stop Learning.
• Civil Service Campaign.
• World Investor Week.
• Investing Quizzes.
• Microcap Fraud.
• Videos
  
  - First Job.
• Switching Jobs.
• Employer-Sponsored Plans.
• Federal Government Plans.
• Individual Retirement Accounts (IRAs).
• Managing Lifetime Income.
• Senior Specialist Designations.
• Social Security.
• Avoiding Retirement Fraud
  
  - Librarians.
• Older Investors.
• Teachers.
• Military.
• Veterans.
• Youth.
• Entrepreneurs
  
  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.
• Learn More About 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.
• Variable Annuities.
• Variable Life Products
  
  - Alternative Mutual Funds. - Leveraged Loan Funds.
• Exchange-Traded Funds (ETFs).
• Index Funds.
• Money Market Funds. - Mutual Funds.
• Smart Beta, Quant Funds and other Non- Traditional Index Funds.
• Time Frame Funds
  
  - Hedge Funds.
• Private Equity Funds
  
  - 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?
  
  Real estate investment trusts (" REITs") enable individuals to buy large-scale, income-producing realty. A REIT is a business that owns and normally runs income-producing property or related possessions. These might include office complex, shopping malls, homes, hotels, resorts, self-storage facilities, storage facilities, and mortgages or loans. Unlike other property companies, a REIT does not establish 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 somebody invest in REITs?
  
  REITs offer a way for individual investors to earn a share of the income produced through commercial property ownership - without really having to go out and purchase industrial realty.
  
  What types of REITs exist?
  
  Many REITs are signed up with the SEC and are openly traded on a stock market. These are called openly traded REITs. Others might be signed up with the SEC however are not openly traded. These are referred to as non- traded REITs (also referred to as non-exchange traded REITs). This is among the most important differences among the different type of REITs. Before purchasing a REIT, you need to understand whether or not it is publicly traded, and how this might affect the benefits and risks to you.
  
  What are the benefits and dangers of REITs?
  
  REITs offer a way to consist of property in one's investment portfolio. Additionally, some REITs may use higher dividend yields than some other investments.
  
  But there are some dangers, particularly with non-exchange traded REITs. Because they do not trade on a stock market, non-traded REITs include special threats:
  
  Lack of Liquidity: Non-traded REITs are illiquid investments. They generally can not be sold readily on the open market. If you require to offer a property to raise money rapidly, you might not be able to do so with shares of a non-traded REIT. Share Value Transparency: While the marketplace rate of an openly traded REIT is easily accessible, it can be difficult to figure out the worth of a share of a non-traded REIT. Non-traded REITs generally do not provide 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 significant period you may be unable to examine the worth of your non-traded REIT investment and its volatility. Distributions May Be Paid from Offering Proceeds and Borrowings: Investors may be drawn in to non-traded REITs by their fairly high dividend yields compared to those of publicly traded REITs. Unlike openly traded REITs, however, non-traded REITs often pay distributions in excess of their funds from operations. To do so, they may utilize providing proceeds and borrowings. This practice, which is typically not utilized by publicly traded REITs, lowers the worth of the shares and the cash available to the business to acquire additional properties. Conflicts of Interest: Non-traded REITs generally have an external supervisor instead of their own employees. This can result in potential conflicts of interests with investors. For instance, the REIT may pay the external manager substantial fees based upon the amount of residential or commercial property acquisitions and properties under management. These fee rewards may not always align with the interests of investors.
  
  How to purchase and offer REITs
  
  You can buy a publicly traded REIT, which is listed on a significant stock exchange, by purchasing shares through a broker. You can acquire shares of a non-traded REIT through a broker that takes part in the non-traded REIT's offering. You can likewise purchase shares in a REIT shared fund or REIT exchange-traded fund.
  
  Understanding fees and taxes
  
  Publicly traded REITs can be bought through a broker. Generally, you can acquire the common stock, preferred stock, or financial obligation security of an openly traded REIT. Brokerage costs will use.
  
  Non-traded REITs are generally offered by a broker or monetary consultant. Non-traded REITs typically have high up-front fees. Sales commissions and upfront offering costs usually total roughly 9 to 10 percent of the investment. These costs lower the worth of the financial investment by a significant amount.
  
  Special Tax Considerations
  
  Most REITS pay 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 normally are dealt with as regular income and are not entitled to the reduced tax rates on other kinds of business dividends. Consider consulting your tax consultant before investing in REITs.
  
  Avoiding fraud
  
  Be wary of anybody who tries to sell 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 also utilize EDGAR to evaluate a REIT's annual and quarterly reports along with any offering prospectus. For more on how to utilize EDGAR, please check out Research Public Companies.
  
  You need to likewise have a look at the broker or financial investment advisor who suggests acquiring a REIT. To learn how to do so, please go to Dealing with Brokers and Investment Advisers.
  
  Additional details
  
  SEC Investor Bulletin: Real Estate Investment Trusts (REITs)
  
  FINRA Investor Alert: Public Non-Traded REITs - Perform a Careful Review Before Investing
  
  Featured Content
  
  School's Out, Investing for Your Future Is In!
  
  Now is a good time for college students and recent graduates to begin thinking of conserving and investing.
  
  Free Financial Planning Tools
  
  Access savings goal, compound interest, and needed minimum circulation calculators plus other investing tools.
  
  Join HoweyTrade?
  
  Our HoweyTrade program may be fake, however it can teach you what real frauds look like. Watch now and find out how to identify the warnings of fraud.