It might be worth investing in real estate funds to give your portfolio some balance. This is not only useful for balancing your more risky stock and bond positions, if chosen carefully can also provide returns that beat inflation.

Although the real estate market in the US has seen declines in the value of properties and hence returns, there are a wide variety of opportunities overseas.

In Europe, countries such as the U.K. and Germany have made great strides in creating real estate financial instruments like (REITS that exist in the US market) that can be bought and sold. In addition there are similar moves to do this in countries such as Singapore, South Korea and Taiwan.

A number of real estate funds trading in the US markets that you might consider investigating for your portfolio include:

Cohen & Steers International Realty Fund Inc. (IRFAX)

Cohen & Steers European Realty Shares Inc. (EURAX)

SPDR DJ Wilshire International Real Estate ETF (RWX)

Cohen & Steers Asia Pacific Realty Shares Inc. (APFAX)

Source: Based on article by Kathleen Gallagher in JSOnline