Key Points
Typically, the largest components within most investor portfolios are equity, debt and physical real estate..
Debt or fixed income (debt mutual funds, fixed deposits, bonds, PPF etc.) generates moderate returns with commensurate lower risk & volatility and can offer high liquidity especially when invested through mutual funds or bank deposits...
Further, real estate investments tend to have lower recurring returns in the form of rental yields, especially for residential assets...
Because property values are large, they could skew your investment portfolio towards lower overall returns, lower volatility and higher illiquidity..
Which means that you should think very carefully about adding real estate to your investment mix and do it only when the overall portfolio size is large enough to handle the illiquidity that comes with such investments...
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