Which investment vehicle is a company that owns income-producing real estate and is traded on a stock exchange?

• A. Real Estate Investment Trust (REIT)
• B. CFA (Certified Financial Accountant)
• C. Series 7 Exam
• D. Cryptocurrency

Answer: (A)

Real Estate Investment Trusts are companies that own, operate, or finance income-producing real estate and are traded on major stock exchanges. They’re designed to pass through most of their taxable income to shareholders, requiring them to distribute at least 90% of that income as dividends, which often gives them higher dividend yields. Being publicly traded also provides liquidity and easy access to a diversified portfolio of property types. Note that there are equity REITs, which own real estate, and mortgage REITs, which own real estate debt; both trade publicly, but only the former truly owns the real estate itself. The other options are not investment vehicles that fit this description: a CFA is a credential, a Series 7 is an exam, and cryptocurrency is a digital asset class rather than a real estate-owning company.