Invest In Real Estate without becoming a landlord.
The stock market is filled with many ways of investing in real estate without becoming a landlord. New investment opportunities are added daily! So, would you like to invest in real estate without becoming a landlord? Stock Market Real Estate Investment opportunities are very broad and very focused. You can invest in a wide variety of real estate baskets worldwide using a single Real Estate ETF.
ETFs are like Mutual Funds, holding many companies inside a single basket. ETFs are better than mutual funds because they have less overhead costs that come out of your pocket. ETFs can be bought and sold in your online investment account just like a single company’s stock.
Let’s look at home builders as an example. Some ETFs baskets contain many profitable home builders in the US. Instead of betting your hard-earned cash on a single builder, using ETFs, you get to buy a small chunk of them all. You won’t get rich quickly using ETFs, but you won’t get poor quickly, either. For every real estate category you can think of, there is most likely an ETF or a REIT to invest in.
REITs are Real Estate Investment Trusts that pay out a large portion of profits to shareholders monthly. REITs, like ETFs, are bought and sold in your online investment accounts, just like a single company’s stock.
So now you know a bit about ETFs and REITs that are Real Estate focused. You know you can buy and sell ETFs and REITs just like regular stocks through your online investment accounts.
Now you want to know which ETFs and REITs to buy.
But first, we need to talk about Money Management. How much money do you want to invest? How do you plan on dividing up and allocating your bankroll? Money Management from the start will keep you in the game. Money Management is the only thing you can control. You can’t control or predict what will happen in the stock market. You can control your money with a few simple rules.
Let’s say you have $100,000 to invest. Would you bet it all on a single stock? Would you make 10 bets of $10,000 each? Would you make 20 bets of $5,000 each? If you are like me, I don’t want to work very hard at this by spending too much time researching ideas. So I’m going to make 20 bets at $5,000 each. 20 bets at $5,000 is spreading my risk.
That’s the first rule. Divide up your starting pot of gold to reduce risk and time spent researching.
The next rule is to decide before you bet the first $5,000 how much of the $5,000 you are willing to lose. For me, $250 to $350 is my limit. At that point, whatever stock it is clearly is a loser, so it gets sold. No second thoughts. SELL SELL SELL your losers without hesitation.
It only takes a couple of Winners to offset the losers when you sell quickly. Never sell to Lock-In for a profit. Sell if your winner when it starts looking like a loser. Managing your bankroll as you make bets in the stock market is the number one reason some people succeed, whereas others fail.
Most people have heard about Fantasy Football Leagues. We get to pick the players on our team. Once we pick the players, we are stuck with them for the season. What if we could boot the losers quickly and pick up new players to take for a test run before deciding to keep or turf them? How long before we end up with a team full of winners? That is what Money Management does. You are the Coach of your investment team. Every stock, ETF, or REIT you buy is a team player that will get to stay or get turfed based on your money management rules.
Money Management is more important than the investments you make. Of course, you gain another advantage if you are or become good at picking winners first.
Money Management done properly is the opposite of the way most people invest. We never average down because we sell the losers quickly. We never lock in profits only to see the stock go higher after selling because we always let our winners run. We never lose it all or bet the farm. We win because we do the opposite of what most people do with a few simple rules.
Ok, back to picking real estate investments. It just doesn’t matter what you pick. Use your own ideas or someone else’s hot tip. With your simple money management rules, you won’t get stuck with a dud for long. When the loser is obvious, out the door it goes to make way for a new bet.
Real Estate ETFs and REITs are an easy way to invest in real estate without becoming a landlord.
Money Management will keep you in the game.
The quickest way to feel like a winner is to cut your losers quickly.
Works in Life and Real Estate Investments!
Jerry Charlton
