Final answer:
Amethyst chose to achieve her goal of investing in real estate through a real estate investment trust (REIT), which pools investors' money to buy and manage property. Similar to mutual funds in structure, REITs provide the opportunity for smaller investors to earn returns from real estate without managing or financing properties directly.
Step-by-step explanation:
Amethyst wanted to invest in real estate but did not have enough capital to purchase commercial property by herself. Instead, she invested in a real estate investment trust (REIT), which is a company that owns, operates, or finances income-producing real estate. REITs pool the capital of numerous investors, making it possible for individual investors to earn dividends from real estate investments without having to buy, manage, or finance any properties themselves. Mutual funds operate on a similar concept, allowing investors to pool their money to purchase a diversified portfolio of stocks, bonds, or other assets, which are managed by professionals.
Investing in REITs or mutual funds can be a viable option for those who want exposure to real estate or various asset classes without the significant capital outlay or management responsibilities required from direct investments. These instruments provide individual investors with the opportunity to gain indirect ownership in a variety of assets, benefit from professional management, and potentially earn returns from the underlying investments.