Resources on Real Estate as Part of A Diversified Portfolio

[Paul Allen]

I am a financial planner. Took all the CFP courses and passed the test. Very (VERY) little of the course material focused on real estate as an investment. Stocks, bonds, and insurance products were covered in detail (don't get me started as to why), but not real estate.

I would like to find some resources that discuss the role of real estate in a diversified investment portfolio. Not resources that discuss exclusively real estate investing, but rather something that includes real estate in the portfolio next to the stocks, bonds, and annuities.

Thanks in advance!

[Chad Olsen]

I may be the black sheep here, but I'm not interested in having anything in the stock market. But I may also not be your target audience. I've made the concerted effort to be an educated investor about my retirement and passive income. So I have tried to take as much of my retirement funds out of the market and put them in an SDIRA which I can then direct to investments that I would want to be in rather than mutual funds etc. I like having the control over the investments, even if it could go south. If I'm going to lose money, I'd rather learn something over just hope and pray for the market. For me, a diversified portfolio looks like cash flowing assets and growth assets and as much good credit as I can get my hands on. Right now those assets are predominantly real estate for me. But over time I know that that can and will change. I'm already looking at investing in a business to learn about how to intelligently invest there. I've talked to a number of friends who do royalty deals, equity deals and debt deals and combination deals. I still think that Warren Buffet and others like him have it right. If everyone is doing one thing, look to do something else. When "everyone" says that the stock market is the place to be, I'll be looking elsewhere. More and more people are looking at real estate lately. So I've started looking into personal finance, private lending, businesses and commercial properties. The nice thing here is, for me any way, is that the average investor is not likely to come and play in these waters for long. This is big deals and typically more work than just becoming an accidental landlord, which I've done. Three times. Sometimes it works and sometimes you learn.

At the end of it all, I think that what you really need to be thinking about is what do the clients want from you? If they are comfortable with being in the stock market and 401ks give them the best options that you can in that space. If you have more and more clients coming to you for things outside of that then you can have a more detailed conversation about what their goals and risk tolerances are. I like where you are going with looking at the "best distribution" based on math and facts. But at the end of the day this mostly comes down to intuition, preference and some luck.