Adam

You're not mistaken. Here is the best comparison that I have found. It seems to have a nice, understandable explanation. Real Estate Vs. Stocks

On the subject of diversification, which as you know from before, I am totally for, you can own a real estate mutual fund. This way you can let the professional money managers buy and sell the holdings they are trained to, while taking advantage of as broad of a holding in the real estate market as possible. After a quick search, I like T. Rowe Price Real Estate (TRREX). Please note, I am not saying go out and buy this fund, I just wanted you to see the kind of fund I'm talking about. I like this one because it is a 4star fund and has a middle of the road approach. From its inception through May 05 only 3 other funds have topped its 13.2% annualized gain. That seems pretty impressive to me. Something that stood out to me was the low turnover rate. 8% in 04. This is because Lee the fund manager seems to really believe in his choices for the long run. This makes me feel more comfortable with his stance in the market.

After saying this, I know a few of our clients that have made a killing in the real estate market. It seems that a few good choices on location and property type go a long way. However, I suppose a few bad ones and you are looking at a major problem.

I have a great chart that compares small and large stocks agianst inflation and bonds but I can't figure out how to insert it into the post. The best part about it, is how it puts them in timeline form and tells the major events in history from 1925 to 2004. Pretty neat to look at. Email me if you would like it. [email protected].

-adam

mschrenker

Test Test Test

SkyHigh

Real Estate = RE

Stock brokers like to compare real estate to stocks in a dollar for dollar fashion and that is a false method to use. Real estate can be heavily leveraged and can be improved upon by the investor. Real estate comes with tax deductions and can produce income. Since RE can be leveraged you can magnify your returns by minimising your down payment. In RE your investment has some protection since there is a bank who is in the deal with you. If the market tanks you can walk away. If you stock tanks you have lost it all.

100K in Stocks up %16 for the year = 116K Yea !!

100K in RE spread over 10 houses worth 100K each or 1million in RE. The average national appreciation is %5 per year so by years end you have 50K in appreciation meaning = $150 in equity BIG YEA !!

Plus your deductions and potential rental income and benefits of being able to use the tangible asset. When your mother in law comes a knockin it would sure be nice to have a vacancy near by.

Stock brokers have a negative view of RE since they can't sell you any. They always try and put stocks in the lime light. The market is due for a bust however I would be very careful about what and where you buy.

SkyHigh

mschrenker

Error Error Error

mschrenker

Test Test Test

TWA/AA

I am a firm believer that there is no real estate “bubble.” I live in the so-called bubble state of Florida. I do believe the market will correct itself and stay stagnant for a couple of years, but you will hear no big POP.

Pilots are not dumb and we do plenty of research. The problem with investing your own money is we tend to use our emotions. To take emotions out of the equation, a large percentage of your money should be professionally managed.

By the way, I am a broker and a pilot. You do not need to say “ATP” in front of major airline pilots.

Steve

f15driver

I have known Marcus Schrenker for about 10 years. He is one of the most honest guys I have ever met. Very, nice, courteuous - and works his butt off. I have known few people with as much energy as he. Thumbs up for this guy.

I would listen to this guy.

Dan Fargo