The Research Of The Investment Strategy Of The REITs

REITs is a typical channel derived from America, whose aim is to avoid the supervision and broaden the financing of Real Estate developer. Since it came out, REITs has brought giant benefits to the Real Estate Industry of America and even the whole world. Besides, REITs successfully absorbed the social capital into the industry and gathered the public resources, which greatly accelerated the development of the Real Estate Industry.The Chinese Real Estate market has been long suffered from lack of financing resources, especially the over-dependence on the bank loan. The rate of bank loan debt of China is far beyond the standard level compared to other countries, and it does cause hidden troubles to China’s financial system. On the other hand, as the minimal invest requirement is higher than other securities, the small investors can’t get the access into the industry. The folk capital is not able to find other assets for substitution, resulting in the imbalance between the demand and supply of the capital.By overviewing the origin, development and pattern of the REITs, we represent here the research of the necessity and feasibility of Chinese Real Estate Industry introducing the REITs. We also try to create an optimal investment portfolio which allocates its capital in and among the four fastest-growing cities in China on the basis of the theory of Modern Portfolio Theory, hoping to provide references when REITs makes decision in its investment portfolio.