Why Timberland REITs are a Buy

Money grows on trees with the stocks of timberland real estate investment trusts.

Invest your treasure in a gold bar, and the size of your bar will be the same in 100 years. But invest that same treasure in a small forest, and the size of your treasure will grow, day after day.

Of course, physical growth is one thing; growth in the value of your investment is another. On that score, timberlands have also done just fine. Over the past ten years through October 31, private investments in land with trees for logging returned 6.9% annualized, compared with a 0.4% annualized loss for Standard & Poor’s 500-stock index. That’s one reason institutional investors have long included timberlands in their portfolios.

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Elizabeth Leary
Contributing Editor, Kiplinger's Personal Finance
Elizabeth Leary (née Ody) first joined Kiplinger in 2006 as a reporter, and has held various positions on staff and as a contributor in the years since. Her writing has also appeared in Barron's, BloombergBusinessweek, The Washington Post and other outlets.