Real Estate Investment Trusts (REITs): Resembling a closed-end mutual fund, REITs are formed to invest funds in a portfolio of commercial mortgages and other commercial real estate related investments (usually income properties such as retail, industry and office buildings). They issue trust units that provide small investors with the opportunity to share in the earnings of a portfolio of real estate products. The Income Tax Act exempts the trust from paying income tax on any earned income paid out to shareholders. Income tax is paid on any earnings that are retained by the trust. Dividends received from REITs however, do not qualify for the dividend tax credit. Trust units are listed and traded on a stock exchange as are shares of closed end mutual funds.

However, it is good investment to generate continuous cash flow. But, some said there is a bubble now. Do a research and tell us whether it is good or bad now.

Risks related to REIT can be:

1. REIT often invest in a particular type of real estate, for example there are REITs in residential buildings or warehouses. The rental market of that type of property can fluctuate. For instance, in 2002 the vacancy rate of apartment buildings in some major US metro area declined quite a bit because people are buying houses and moving out of rental home. This will affect the revenue of the REIT that holds such property.

2. More importantly, many people don't realize that most of REIT are leveraged, which means the Trust borrows money to invest in those properties. The interest rate is at record low now. If it starts to climb up, the financing cost of those REITs will shoot up, which means they will have less cash to distribute to unit holders.

In conclusion, the REIT unit today might behave more like small cap stocks. This is quite different from a novice investor's impression that "return from real estate investment is steady".

的几个都在持续降低所持有的REIT的比例，转向Business investment Co.

在MUTUAL FUND的范畴中，也有Real Estate Fund,属于比Equity Fund更加高风险的FUND产品。