The Benefits and Disadvantages
Of Real Estate Mutual funds

As with most investments, and especially stocks, there is no guarantee of future appreciation. One stock may perform quite well, and another might decline considerably. Consequently, many investors look for professional assistance from the management of a mutual fund to select not only good stocks, but also a diverse group of stocks that will provide protection in case of a few bad selections. A manager of a real estate mutual fund specializes in REITs and will be much more knowledgeable of this industry than most other individual investors. Another advantage of a mutual fund is that the minimum amount of money to invest can be very reasonable, (from as little to $250, but frequently about $2,000 for new accounts). It's difficult to acquire a diverse portfolio of REIT stocks with this amount of money without incurring very significant commission costs. And, as companies change, it may be necessary to sell or buy certain issues. This not only takes additional effort and time, but increases commissions and expenses, taking away even more from your capital. In addition, mutual funds issue financial statements and information that help you keep current with your investment and assists you with tax preparation. Most mutual fund families also allow you to exchange funds, which provides greater flexibility. However, if you have the time, interest, skill and adequate finances, then you may want to avoid mutual funds and invest in REITs yourself. An excellent source on the Web to help you with this is RealtyStocks (www.realtystocks.com). An advantage of individual investing is that you can buy only one or a few stocks that you feel may outperform an index or large group. Most important to some is that you can control capital gains tax by selling at a time that is better for your personal finances. Some people can even control expenses better than a mutual fund can. And, for long-term oriented investors, greater value may be achieved by keeping assets rather than selling them to avoid paying capital gains taxes, which reduces asset values. RealtyStocks also covers real estate operating companies and firms in industries related to real estate -- two important factors an individual investor may want to consider. Some analysts consider construction, development, home builders, and other industries to have greater appreciation potential than REITs (albeit much lower current dividends), so this may be of interest to you. If you want broader coverage than you'll get with most real estate funds, which invest primarily in REITs, you may need to become an individual investor. However, if you are most interested in REITs and feel the advantages of the mutual funds outweigh those of individual investing in individual stocks, you need to select the best real estate mutual fund for you. RealtyFunds can help. REALTY FUND SPONSORS Become a RealtyFund Sponsor and have a profile created for your mutual fund. See our SAMPLE! It can be registered in all major search engines. Also, Inquire about our advertising banners! E-MAIL: stocks@inrealty.com Copyright © 1997 - 2002, WebVisers Inc. All rights reserved