This module discusses the pros and cons of investing in tangible assets, including real estate, gold, oil, and other natural resources. Different types of energy master limited partnerships are covered. Real estate is addressed extensively including its advantages and disadvantages as an investment and how to calculate the value of income producing property. Real estate investment trusts (REITs) are covered in detail, including publicly traded, non-traded, and private REITs.

6–1 Explain the characteristics, risks, returns, markets, and valuation of tangible asset investments.
6–2 Explain the structure and types of energy master limited partnerships.
6–3 Explain the characteristics, risks, returns, financing methods, types, and forms of ownership of investment real estate.
6–4 Calculate net operating income and property value from real estate property information.
6–5 Evaluate the value of real estate property using real estate valuation techniques.
6–6 Explain characteristics of public, nontraded, and private REITs.
6–7 Evaluate the advantages and disadvantages of investing in public, nontraded, and private REITs.

Author: Jim Pasztor, MS, CFP®

Jim Pasztor, vice president of Academic Affairs at the College for Financial Planning is also involved with several of the College’s investment courses and the white paper series. He is a CFPM® practitioner, and has an MS degree in personal financial planning and an MSF degree in financial analysis, both from the College for Financial Planning. Jim was the recipient of the Edward D. Baker III Journal Award from IMCA in 2014 for his article Endogenous Risk and Dangers to Market Stability. You can reach Jim at jim.pasztor@cffp.edu.

Complexity Level: Advanced