engleski

Capital Market vs. Real Estate Market – Investment Aspect

The basic goal of this paper is to compare the Croatian capital market and the real estate market from the perspective of a potential investor. For this purpose, a sample of shares from the Zagreb Stock Exchange was selected as a representative of the capital market, and different types of real estate were selected as a representative of the real estate market. The investor aspect involves a portfolio approach to determine the relationship between expected rates of return and risk, and this is done here by setting efficient frontiers. By comparing the efficient frontiers for these two markets, it was found that the real estate market allows more efficient investments, and it is located northwest of the efficient frontier composed of investing in stocks. Moreover, a specific declining form of the efficient frontier of real estate investments has been established, suggesting the possibility of achieving higher rates of return with lower rates of risk.

Capital market, Real estate market, Efficient frontier

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