Buildings favoured over property firms

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Investors are around seven times more likely to buy into bricks and mortar property funds than property securities funds, despite the potential for higher returns.

Analysis carried out by Fidelity International reveals in 2006 property security funds performed well, with the average fund delivering a return of around 37.86%, which is more than double the average return of 17.9% from a 'bricks and mortar' fund. Fidelity argues while most directly-invested property, or bricks and mortar, funds limit the investor’s exposure mainly to the UK, property security funds tend to be diversified across the world, with an average weighting of 30% in the UK, so generate higher returns. As a result, the investment house believes because the investment correlati...

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