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Homepersonal financeSaving for retirement? Be wary of these investments

Saving for retirement? Be wary of these investments

For the average American retirement saver, the world of investing can feel a lot like that scene near the end of "Indiana Jones and the Last Crusade." The Holy Grail–a wise investment that will perform well over time–is right in front of you. But it's hidden among a host of glittering frauds–investments that could kill your returns if you pick them.

No one wants to reach retirement age, only to be faced with an anemic nest egg and hear echoing in their minds the words of the Crusader: "He chose … poorly."

While it's impossible for anyone to accurately predict the future and point you toward the guaranteed winners, it is possible to spot some likely losers.

Here are a few investments advisors say retirement savers may want to avoid.

Not everyone has either the means or the desire to become a landlord. For those who don't, a real estate investment trust is an easy entry into that world.

REITs are required by law to distribute 90 percent of their income annually to shareholders in the form of dividends. For a person looking for an income stream in retirement, that's a great selling point. Investing in large, publicly traded REITs like Acadia Realty Trust or Simon Property Group is as simple as buying stock.

Non-traded REITs

Mark Edward Atkinson / Tracey Lee | Getty Images

But nontraded REITs are a house of a different color–one so shaky that FINRA has issued a warning about them.

There are some advantages. Both exchange-traded and nontraded REITs offer a hedge against inflation, since the underlying properties can raise rental fees if interest rates begin to rise. And there's that 90 percent distribution requirement.

But with nontraded REITs, you're locked into the investment for a period that can range from five to 10 years. That's what "nontraded" means: there's no exchange to sell them on. So it's hard to unload your shares early if you need the money. And if your nontraded REIT does have a program under which it's willing to repurchase shares, it will be at a discount to the price you paid.

Read MoreWeighing the risks of non-traded REITs

Another concern: You frequently don't know what you're buying. Nontraded REITs are often set up as "blind pool" investments. The managers pitching you on the investment may tell you what kind of real estate they intend to buy and can provide you with projections about how they think those deals might work out. But they do not tell you what specific real properties will be acquired.

Nontraded REITs can also have outrageous fees: "front-end fees that can be as much as 15 percent of the per share price," notes FINRA.

Bottom line: If you want to own a REIT, publicly traded ones offer lower costs and more liquidity.

Managed-futures funds

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