A Real Estate Investment Trust (REIT) is a security that trades like any asset on an exchange, similar to an ETF. A REIT pools the funds of investors and then invests it into real estate via mortgages or properties.
There are 3 main kinds of REIT:
- Mortgage - loaning money for mortgage purposes and receiving the interest payments
- Equity - investing in actual properties and owning a stake in them and receiving money either from rent or from resale
- Hybrid - combination of Equity and Mortgage