The floating rate received in the swap matches the floating rate the company pays in the underlying loan. The result is a fixed rate to you. Regardless if rates rise or fall, your borrowing rate remains fixed at the swap rate. Industrial Revenue Bonds are tax-exempt bonds issued by a municipality, public authority, or other government agency on behalf of private companies for the purpose of constructing, acquiring, improving or equipping eligible facilities. Real Estate Investment Trusts , or REITs, are a form of indirect real estate investing.
Money pooled is placed in real estate ventures, such as mortgages or real property.
These trusts are then managed by one or more trustees who have transferable shares or certificates held by at least 100 persons. Investors receive cash distributions. Although REITs receive special tax treatment, they are not a tax shelter. This investment allows you some liquidity. There is risk involved, but you also have high yield and are hedged against inflation.