Feel like shorting REITs

Just a joke.
But looking at the yield of the REITs, the better REITs are around 5.5% while the industrial REITs are around 7.5%.

The yield has come so low that many non-REIT stocks have a equivalent or higher yield than REITs while having a clean balance sheet with little debt.

Is there any good reason to hold on to REITs currently?

(06-09-2012, 02:04 PM)yeokiwi Wrote: Just a joke.
But looking at the yield of the REITs, the better REITs are around 5.5% while the industrial REITs are around 7.5%.

The yield has come so low that many non-REIT stocks have a equivalent or higher yield than REITs while having a clean balance sheet with little debt.

Is there any good reason to hold on to REITs currently?

http://www.bloomberg.com/news/2012-09-04...-asia.html

This article proves your point.

Well, I won't buy REITs, but I won't go so far as to short them either.

Let's look at some blue chips.
SPH, Singpost, around 5-6%.
ST Engg, SIA Engg around 4-5%
SGX is also around 4%.

The yields are not too far off from those low yield REITs.

Shorting are for very "special talented market player", IMO. But i were forced into become a day-trader shortist at least more than 2 or 3 times in my investment career. i use internet to B/S. i had used the wrong key lol!
i hope it will never happen to me again

(06-09-2012, 02:04 PM)yeokiwi Wrote: Just a joke.
But looking at the yield of the REITs, the better REITs are around 5.5% while the industrial REITs are around 7.5%.

The yield has come so low that many non-REIT stocks have a equivalent or higher yield than REITs while having a clean balance sheet with little debt.

Is there any good reason to hold on to REITs currently?

Maybe not for the "intelligent" investor, but funds that have to be invested at all times, may have no choice but to find something to buy.

(06-09-2012, 02:04 PM)yeokiwi Wrote: Just a joke.
But looking at the yield of the REITs, the better REITs are around 5.5% while the industrial REITs are around 7.5%.

The yield has come so low that many non-REIT stocks have a equivalent or higher yield than REITs while having a clean balance sheet with little debt.

Is there any good reason to hold on to REITs currently?

It all depends on your own mental images.

http://www.advisorperspectives.com/dshor...apshot.gif

Alas, i have sold almost all my REITS much earlier. Now it looks like really i sold too early. But i need some solid funding in November onwards.
You see no one's mental images is the same.

It'd appear that the market is showing their confidence in the REITs depending on the Sponsor-Manager, if we were to use an over-simplistic approach by just looking at the Yields. Using today's closing price, I have the following groupings based on Yields (using latest Quarterly DPUs),

>7%
Sabana
SaizenREIT
Cambridge
A-HTrust
AIMSAMPI Reit
LippoMalls
AscottREIT
First REIT
CLT

6% to 7%
K-REIT
CapitaRChina
MIT
SuntecReit
Ascendasreit
MapletreeLog

5% to 6%
FrasersComm
Starhill Gbl
CDL Htrust
FE-Htrust
CapitaComm
FrasersCT
MCT

4% to 5%
PLife REIT
CapitaMall

If I simply look at 7% as the cut-off. What we see above 7% Yield are mostly the non-"branded" ones. Except for AH-Trust which was newly listed and AscottREIT (High Gearing + many assets in Europe), the rest have "weaker" managers.. Perhaps my perception only... Indonesia ones? Perhaps still have political risks as regional govt is not as stable as ours??

As for those below 7%, we see the REITs that are linked to Temasek (Mapletree, Capitaland, Keppel, Ascendas, Frasers) with the rest linked to the Richest in Singapore (Far East - late Ng Teng Fong, CDL - Quek family). PLife may be the exception but they do have an inflation component built in on rental reversion

Interesting?? This is despite the facts shown by d.o.g.'s figures + swakoo's graphs in another thread that CMT, CCT and KREIT had done value destructive rights issues during the worst of the financial crisis. Under normal circumstances, that means...LOUSY Managers...

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(06-09-2012, 02:04 PM)yeokiwi Wrote: Just a joke.
But looking at the yield of the REITs, the better REITs are around 5.5% while the industrial REITs are around 7.5%.

The yield has come so low that many non-REIT stocks have a equivalent or higher yield than REITs while having a clean balance sheet with little debt.
Is there any good reason to hold on to REITs currently?

(06-09-2012, 02:49 PM)yeokiwi Wrote: Let's look at some blue chips.
SPH, Singpost, around 5-6%.
ST Engg, SIA Engg around 4-5%
SGX is also around 4%.

The yields are not too far off from those low yield REITs.

Most of the Blue Chips you listed do have lots of debts... except for SIAEC. Not sure abt SGX as I don't track. What you say would be true if we go compare with small and mid caps stocks. But then again, they may not be able to survive any economic recession as well.

IMO, even the Blue Chip Yields are getting a bit low for my comfort.. it can't even cover the current high inflation era we're going thro' now...

I am always a perma-bear.
But still I would like to point this out.

Remember when was the last time REITs yield fell this low? Yr 06, 07.
However I believe the low yield may well sustain themselves for a longer time due to no other better asset class for both capital preservation (in long run) and yield accretive for the retail investors.

(06-09-2012, 06:49 PM)arthur Wrote: I am always a perma-bear.
But still I would like to point this out.

Remember when was the last time REITs yield fell this low? Yr 06, 07.
However I believe the low yield may well sustain themselves for a longer time due to no other better asset class for both capital preservation (in long run) and yield accretive for the retail investors.

During Jun-07, the Average Yield (all REITs) = 4.249% vs Now = 6.465%.
The lowest Yield = 1.934% for CRCT. At below 3%, we have CCT, CMT, KREIT and CDL H-Trust. Ya, 3 of the Value Destroyers were there...

Perhaps if we adjust for inflation, then we may be worse off now....