Real assets play a crucial role in business operations for several reasons:
Stability and Security: They provide a stable and secure foundation for business operations. Unlike financial assets, their value is less likely to fluctuate wildly. Collateral for Loans: Real assets can be used as collateral to secure business loans, making it easier for companies to obtain financing. Inflation Hedge: Real assets often appreciate over time, providing a hedge against inflation. This is particularly true for real estate and natural resources. Revenue Generation: Many real assets, like rental properties and machinery, can generate income, contributing to the business’s overall revenue.