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Executive Summary. Timberland is seen as a long-term investment that has recently received increased institutional investor attention in many countries and potentially provides added value in a mixed-asset portfolio. Using the National Council of Real Estate Investment Fiduciaries (NCREIF) timberland series, this paper analyses the risk-adjusted performance and portfolio diversification benefits of timberland in the United States over the period of 1987–2007. Timberland in the U.S. is seen to have been a strongly performed asset class with significant portfolio diversification benefits over this period, with a significant portfolio role separate to that of real estate. However, recent years have seen reduced risk-adjusted returns, with some loss of portfolio diversification benefits of timberland with stocks and real estate. Global drivers are likely to see increased future demand for timberland investment.
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Newell et al. (2009) studied this question.
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