How global property can boost your portfolio

Global property funds produced an impressive return of close to 30 percent to the end of December 2014. This may prompt you to consider including these funds in your portfolio – or is the party over, and will latecomers be doomed to pedestrian or even negative returns?

Managers of global property funds don’t expect performance to be as spectacular in future, but they say there is still an opportunity to earn good returns. They expect nominal (before-inflation) total returns of between eight and 12 percent a year in United States dollars over the next three to five years.

The fortunes of the rand will affect the returns received by South African investors – and, as with investments in other offshore asset classes, hedging against rand weakness is put forward as a good reason to invest in global property.

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