A Real Estate Investment Trust (REIT) is a company that owns, operates, or finances income-producing real estate. REITs own many types of commercial real estate, including office and apartment buildings, warehouses, hospitals, shopping centers, and more. They can be publicly traded on major exchanges, publicly registered but non-listed, or private. REITs are organized as partnerships, corporations, trusts, or associations that invest directly in real estate and real estate mortgages. There are two main types of REITs: equity REITs and mortgage REITs (mREITs) . Equity REITs operate like a landlord, owning the underlying real estate, collecting rent checks, providing upkeep, and reinvesting into the property. Mortgage REITs, on the other hand, dont own the underlying property but own debt securities backed by the property. They lend money to real estate owners and operators either directly through mortgages and loans or indirectly through the acquisition of mortgage-backed securities. REITs generate a steady income stream for investors but offer little in the way of capital appreciation. They are strong income vehicles because, to avoid incurring liability for U.S. federal income tax, REITs generally must pay out an amount equal to at least 90 percent of their taxable income in the form of dividends to shareholders. REITs are also known for their comparatively low correlation with other assets, making them an excellent portfolio diversifier that can help reduce overall portfolio risk and increase returns.