REITs primarily invest in which of the following?

Real Estate Investment Trusts (REITs) primarily invest in real estate properties, which is why this choice is the correct answer. REITs are companies that own, operate, or finance income-producing real estate across a range of property sectors. By pooling funds from multiple investors, REITs are able to purchase, manage, and sell real estate assets, yielding income predominantly through rental payments and property appreciation.

Investing in real estate allows investors to gain exposure to the real estate market without having to buy physical property directly. This investment structure also enables REITs to offer liquidity similar to stocks, making them an appealing option for those interested in real estate investment.

In contrast, stocks and bonds, commodities, and utility companies represent different investment vehicles and sectors. Stocks and bonds are financial instruments representing ownership and debt, respectively. Commodities refer to basic goods used in commerce that are interchangeable with other goods of the same type. Utility companies focus on the provision of essential services like electricity and water. Hence, these areas are outside the primary focus of REITs, which is exclusively real estate.