What Flip Growth Investment Means by Real Assets
Real assets are physical investments whose value comes from their substance and utility: real estate, infrastructure such as toll roads and pipelines, farmland, timber, energy and commodities like gold. They differ from financial assets, which derive their value from a contractual claim such as a share or a bond.
Because many real assets generate income linked to prices — rents that rise with inflation, tolls indexed to the cost of living — investors often use them to help protect purchasing power over time.
Common types of real assets
- Residential and commercial real estate
- Infrastructure: utilities, transport and telecommunications towers
- Natural resources: farmland, timberland and energy
- Precious metals and other commodities
How Flip Growth Investment Readers Access Real Assets
Few individuals can buy an airport or an office tower outright, so most exposure comes through listed vehicles. Real estate investment trusts (REITs) own income-producing property and distribute much of their income as dividends. Infrastructure funds and commodity exchange-traded funds (ETFs) offer similar access to other segments.
Risks to understand
Real assets can be illiquid, sensitive to interest rates and exposed to local economic conditions. Leverage inside property funds can amplify losses, and commodities produce no income of their own. Diversifying across types and regions helps manage these risks.