Right Reit I Like - 5 Oct

If l have a limited funds of $10k, a decision can be made based on yield% or dividend amount expected on the right Reit stock to invest in.  I have used previous year's payout rate as a quick guide but the payout dividend rate in Oct'12/Nov'12 will definitely not stays the same.

Right Reit l Like - 23 Mar

All Reit companies have recently already gone ex-dividend and some investors would be reviewing their stocks portfolio either to add, reduce or hold on to their Reit stocks. Below is a quick compilation for comparison review. 

If assuming that an investor has a limited funds of $10k, a decision can be made based on % ROC or dividend amount expected and also by using previous year's payout rate.  Previous year's payout rate is definitely not so accurate but it can be used for quick guidance on which companies can be expected to generate highest dividend yield for their next quarter's results.

previous posting :-    Right Reit l Like - 2 Mar

Right Reit l Like - 2 Mar

This is the final week to get into to both MIIF and CapitaRChina.  Stock that goes ex-dividend not necessarily will shed its share price.  It is really not so easy to forecast how a share price would react when it goes ex-dividend.  I reckon, stock that goes ex-dividend in a positive stock market would see its share price either unchanged or going up further; and its share price would go south in a negative market.  So, is it still worth going into both MIIF and CapitaRChina?

Looking at ROC itself is not that practical though.  As shown in the table below :- CDL Trust - ROC 3.09%, dividend amount $267;  LippoMalls - ROC 2.93%, dividend amount $293.  Though CDL (3.09%) has a higher dividend yield rate versus LippoMalls (2.93%) but when it comes to absolute dividend amount, LippoMalls ($293) is much better than CDL ($267).  As below is based on last year's declared interim dividend rate, circumstances this year would be different.  For example, Pluit Village and Plaza Medan Fair will add more rent collections for LippoMalls and revenue from Studio M Hotel will go into full swing for CDL.


The table below is assuming that all other matters remaining constant as each Reit stock has varied and many types of planned changes to its portfolios; so, the table below is just a quick guidance of the possible returns which can be so much different for an investment amount of $10k.   

Just to remind myself on my journal of 18 Feb :-
Money is always not enough so it must be used to work hardest so as to generate highest returns.  Assuming that l have $10k of funds and my focus is Reit and business trust; and also investment horizon timeline is important - one to two months or less than 6 months. Because of short investment timeline preference, l will not be looking at annual dividend payout rate. So, this table goes to show that with a available funds of $10k, l can get say, Cambridge 19 lots and its dividend amount of $190 versus say, Sabana Reit 10 lots which generates dividend amount of $304. Both stocks are having ex-dividend dates in May month.  A loyal investor on Cambridge would loose out to a cyclical investor who would have selected Sabana instead.  If stock prices are lowered (or gone up) then l can buy more (or less)  and this will directly affecting the dividend amount and its yield.  If the overall stock market is in a bull run but not supported by a bullish economy then there is no reason to drool over the high dividend amount and buying into the high dividend yield stock immediately.  Just Do It is not suppose to work this way.

previous journal :- Right Reit l Like - 24 Feb

Right Reit l Like - 24 Feb

Under March and April months category, MIIF now is a chart topper in both ROC and absolute dividend amount.  MIIF gives a wonderful surprise by declaring higher dividend rate versus same period in 2011.  The top five preference ranking in terms of both ROC and absolute dividend amount have the same stocks components.  My personal preference is on the absolute dividend amount.  Though CapitaRChina has a higher ROC comparing with Frasers Comm but the latter has a $34 more on dividend amount.

Back to MIIF again, l reckon almost all investors are caught off guard by the higher dividend rate.  Its last done price in both this week and previous week stays at $0.585 and hence with $10k, an investor can get the same 17 lots shares.  But if the investor have decided to park his $10k funds with other Reit stock and not with MIIF then it's really a harsh punishment as the latter's higher dividend rate means an additional $213 forgone.

  

previous journal :-  Right Reit l Like - 17 Feb

REITs - getting ready for scrip dividend

Name of Tax Change
Liberalising the cash distribution requirement for tax transparency for Real Estate Investment Trusts (“REITs”)

Current Treatment
To enjoy tax transparency, REITs must distribute at least 90% of taxable income in the same financial year in which such income is derived. The distributions to the unit holders must be made fully in cash.

New Treatment
To enhance our tax regime for REITs, a REIT that makes distributions to unit holders in the form of units can continue to enjoy tax transparency. This is subject to the following conditions:

(i) Before the distribution, the trustee of the REIT grants the unit holders the option to receive the distributions either in cash or units in that REIT; and

(ii) On the date of distribution, the trustee of the REIT must have sufficient cash to make the entire distribution fully in cash had no option been given to those unit holders to receive the distribution in units in that REIT.

Unit holders that elect to receive distributions in units will be taxed in the same manner as if they had received the distribution in cash.

This change will take effect for distributions made on or after 1 April 2012.

Right Reit l Like - 17 Feb

Money is always not enough so it must be used to work hardest so as to generate highest returns.  Assuming that l have $10k of funds and my focus is Reit and business trust; and also investment horizon timeline is important - one to two months or less than 6 months. Because of short investment timeline prference, l will not be looking at annual dividend payout rate.

From the table and for Reit with ex-dividend date in the next one to two months, the top five value for money Reits are Frasers Comm, CapitaRetail China, MIIF, First Reit and Suntec Reit.

For longer ex-dividend dates, l would go for Ascendas India, Ascott Reit, K-Reit, Saizen Reit and Sabana Reit as these are expected to generate much higher returns versus popular Reit stocks, as an example on LippoMalls, Cache Logistics, Cambridge Industrial, K-Green, CitySpring and others.

So, this table goes to show that with a available funds of $10k, l can get say, Cambridge 19 lots and its dividend amount of $190 versus say, Sabana Reit 10 lots which generates dividend amount of $304. Both stocks are having ex-dividend dates in May month.  A loyal investor on Cambridge would loose out to a cyclical investor who would have selected Sabana instead.

The ranking will not be static as older ex-dividend dates will become obsolete as newer dates will then be assumed and their re-ranking is required.  As all stocks prices have gone up by a lot in recent weeks then its probably unwise to rush in to buy my favorite counters.  There is "plenty" of time till ex-dividend dates in March and if this is missed, ex-dividend dates in April and future months can be targeted.

If stock prices are lowered (or gone up) then l can buy more (or less)  and this will directly affecting the dividend amount and its yield.  If the overall stock market is in a bull run but not supported by a bullish economy then there is no reason to drool over the high dividend amount and buying into the high dividend yield stock immediately.  Just Do It is not suppose to work this way.

Reit stocks are popular as passive income source but they can be leveraged for an even bigger and better returns.  It is better not be overly sentimental  on certain Reit stocks but be always ready to consider other Reit stocks.  Thinking of only the same and certain Reit stocks are god-send is not a wise decision.  Even research houses do not always have the same stock pick within the same industry (hospitality, industrial, office, retail, etc.).