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Waiting to increase exposure to AIMS AMP Capital Industrial REIT and First REIT.

Sunday, August 7, 2011

Continuing from my last blog post, which I said we should get ready and be greedy, I am interested in accumulating more units of AIMS AMP Capital Industrial REIT and First REIT as well if prices should weaken in the next few sessions.

AIMS AMP Capital Industrial REIT, as mentioned in my last blog post, has the honour of closing with its unit price unchanged in a sea of red in the last session.

I suppose Mr. Market recognises the REIT's stronger numbers and astute management. However, Mr. Market is also known to be whimsical. If there should be a sell down, I am ready to buy more. Buy? At what price?

Since April, price moved higher as the MACD formed lower highs. A negative divergence. So, buying recently at 22c or 22.5c would have been unrewarding. In fact, selling some would have been a good idea. A correction is to be expected.

Where is a strong support? I see 20c as a very strong support. Apart from being a nice round number, it is also where we find the 138.2% and 150% Fibo lines approximating, both golden ratios.


Fundamentally, 20c would be a very nice price to add to my long position as well. That would give a distribution yield in excess of 10% per annum and it would be purchasing at a 30% discount to NAV.

Regular readers would remember that I divested some of my investment in the REIT recently as I balanced its weighting in my portfolio with that of Sabana REIT. With its stronger numbers which includes a higher DPU and plans to redevelop 20 Gul Way, accumulating on weakness is what I will be doing.

However, many are also queueing to buy at 20c. So, one bid higher? 20.5c? Why not?


As for First REIT, its very low gearing and defensive quality of its assets are very attractive. The management also has a very good track record to boot. Closing at 79c, it is now offering a distribution yield of more than 8% per annum once more.


The uptrend on the MACD has been broken in the last session. Could price go lower? It could and if it does, I expect strong support at 77c next. That is a natural support level as it was the top of an interim basing process. It is also where the rising 100dMA will be approximating soon. Buy more at 77c? Probably.

Related posts:
AIMS AMP Capital Industrial REIT: Higher DPU and 20 Gul Way.
First REIT: 2Q 2011 results.

17 comments:

Anonymous said...

Hi AK71,

Do you have any TA source to recommend? I like the graph charts you have plotted.

Anonymous said...

Motley: I sold of everything. I think i depress the sabana reit price ...

but i think at those low prices. it is a good buy.

I just like being a bear. Interesting to watch at the sidelines. this is my ticket price to watch the show.

EG said...

Hi AK.

Been referring to your blog for some solid input for quite some months now.

Like the Reits you have recommended so far. Vested in AIMS AMP which has turned out great.

Anyone here knew what happened to the reitdata.com site?

Guan

fiinancialray said...

Good strategy.
Perhaps time to move in.
My guess is QE3 cannot be too far away.
US also needs something to calm nerves and soothe the mind.
So hopefully Ben can say something reassuring.

financialray said...

Hmmm,
Feels like QE3 is really coming..
the STI suddenly reverses its loss from 140 over points after my lunch....to about a 85 point loss...what a roller coaster ride.

AK71 said...

Hi Anonymous,

I use ChartNexus. You can find it free on the internet.

The version I use is bundled with my trading account from Lim&Tan.

AK71 said...

Hi Motley,

I collected more Sabana REIT at 91c and 90c per unit today. :)

AK71 said...

Hi Guan,

Absolutely no idea what happened to reitdata but I am glad AIMS AMP Capital Industrial REIT has worked out nicely for you.

I bought more units at 20.5c and 20c today. ;)

AK71 said...

Hi financialray,

I do not know about QE3 and stuff. I had a plan and I executed the plan. ;)

Bought more AIMS AMP Capital Industrial REIT, Sabana REIT and First REIT today. :)

Hwang said...

Managed to pick up some First Reit today. Guess i will monitor a while before deciding next course of action.

CT said...

Hi AK,

tks for the long reply in an earlier post. ill be quite happy to reap 9-10% per year every year. dont have the experience to pick stocks. so im going with fairly safe bets. loaded up on AIMs at 20.5, Sabana at 91 and First at 74.5.

however, im quite open to being up to 90% vested in stocks if more panic selling takes place.

AK71 said...

Hi Hwang,

Good luck to us all. :)

AK71 said...

Hi CT,

I can't agree with you more. 80% of my portfolio is invested for income.

Off the cuff, I estimate that it has a yield in excess of 8% per annum on cost. That is pretty decent, I feel.

The constant passive income streams provide comfort in uncertain times, especially.

It seems that both of us loaded up on the same REITs today. ;)

INVS 2.0 said...

Hi AK,

I was buying AIMS at both prices of 0.2 and 0.25 but too many ppl were queuing up. Well, I bought at 0.21 instead and no loss clocked. Love this stock! It survived both Black Friday and Black Monday. :)

I also fished up some shares on First REIT when it fell below 0.76.

Only my Starhill suffered the biggest drop. But I expect it to recover soon after this August chaos.

All the best to all of us here. :)

Anonymous said...

Motley :

yes everyone should have a plan.

Haha good buy at those prices, actually I think VERY good buy. Maybe i sold you some ...

I would buy at that price too. But I was selling.... this time.

I have always been bearish. So I stick to the bearish plan. But the ride up was profitable.

AK71 said...

Hi INVS 2.0,

Very unique nickname? Version 2.0? What happened to Version 1.0? ;)

I managed to buy AIMS AMP Capital Industrial REIT at 20c and 20.5c today because they were overnight buy orders. You might want to try keying in your orders the night before in future. :)

First REIT is rock solid! Time tested management too! :)

AK71 said...

Hi Motley,

Thank you for selling me some of your units in these REITs. ;p

We should all have a plan but it does not mean we will have the same plan, right? As long as you have thought yours through and are comfortable with it, execute it. I would do the same. :)

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