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Benefits of including listed property in a balanced portfolio

Contributor: Craig Smith from Anchor Stockbrokers

Benefits of including listed property in a balanced portfolio

While listed property has underperformed bonds (11.02%), cash (7.56%) and equities (2.53%) over the last year, it has been the best performing asset class over a 5 and 15-year period. The listed property sector has gained increasing exposure to offshore property over the last 3-5 years and the strengthening ZAR over the last year has been a major contributor to the underperformance of listed property over this period – the ZAR has in recent weeks given back some of the gains over the last few weeks following the recent sovereign downgrades by S&P and Fitch.

Listed property still compares favourably to equities and bonds on a risk adjusted basis over a 5, 10 and 15-year period.

Furthermore, adding listed property to a balanced portfolio enhances the return per unit of risk over a 3, 5, 10 and 15-year period.

Therefore, while listed property has come under pressure over the last year it is important to view listed property in the context of a balanced portfolio (& flowing from this the benefits that listed property introduces into a balanced portfolio).


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