- CFA Exams
- CFA Level I Exam
- Study Session 15. Alternative Investments
- Reading 40. Publicly Traded Real Estate Securities
- Subject 2. Net asset value approach
CFA Practice Question
True or False? REIT share price should be equal to NAVPS if NAVPS is measured properly.
Correct Answer: False
REITs are operating companies, not just real estate portfolios. The two measures are most likely different, indicating potential undervaluation or positive future events. Net asset value per share can be viewed as the largest component of the intrinsic value of a REIT.
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