Thanks Pete.  I'm not a big statistician, but I want to observe that it may be misleading to compare the SD of the REA to the SD of a stock or bond index.  That's because the latter are marked to market every day, while the REA (by universal comment, if without clinical evidence) has its Net Asset Value "smoothed".  At the very least, actual appraisals seem to be staggered over the year, and interim appraisals certainly cannot be done even weekly on every property.  If there's anything harder to value than real estate, it would be a partnership with a developer, which there are plenty of in the REA as well!

One can easily argue that investor sentiment has exactly the opposite effect on the daily value of a REIT fund, for example.  I only bring this up because it's so hard to fit REA into a Procrustean bed of a three-asset allocation formula.  I'm content to think of it as "safer equity".  I don't like to make up a term like "riskier bonds", however.

I continue to own REA for the long term.

Tim