Saizen REIT and Sabana REIT.

Moody’s Investors Service has upgraded Saizen REIT’s corporate family rating to B1 from Caa1 following the conclusion of their rating review.

The stable outlook reflects Saizen REIT's improved liquidity and the absence of material refinancing needs in the next two years.

Read announcement here.

Sabana Real Estate Investment Management Pte. Ltd., the Manager of Sabana Shari’ah Compliant Industrial Real Estate Investment Trust, is pleased to announce the maiden donation of its non-Shari’ah compliant income to the Straits Times Pocket Money Fund and the Embassy of Japan for the relief and reconstruction efforts in Japan.
 
Read announcement here.

Win a fresh Apple iPad 2!

What’s a fresh drink without a fresh look? Marigold PEEL FRESH is celebrating their 25th Anniversary with a range of limited edition packs! And we want you (yes you!) to be part of the fresh face on these juicy packs!


Calling all Singaporeans of all age, gender and walks of life! Send in your Fresh designs and stand a chance to win a fresh Apple iPad 2! Winning entries will be splashed over the 25th Anniversary limited edition packs and the results will be announced at the Fresh at 25 Party on 29 July, 2011!

The Fresh at 25 Party will be a closed door event with celebrities and DJs, so send in your designs to celebrate the juicy goodness and add a fresh face to Marigold PEEL FRESH!

Do it today!

Golden Agriculture: Strong resistance.

I am still bullish on the long term fundamentals of crude palm oil. The more robust demand for the vegetable oil in emerging economies, especially in China and India, will provide a floor to any correction in price.

A correction? Yes, prices do not go up in a straight line. If prices do move higher, they climb a wall of worries.

The share price of Golden Agriculture is finding it hard to move higher than 68.5c in recent sessions. If we take a look at the daily chart, it becomes clearer why this is so. 68c is where we find the merged 20d, 50d and 100d MAs.

Volume has been relatively thin and we have to bear in mind that share price is moving closer towards the apex of a symmetrical triangle. If volume does not increase with an accompanying push to move price higher, we might see support at 66c broken and price moving lower.

If price were to retest support at 66c, I could buy more shares in the company but it would be a smallish purchase in case price were to move higher. A trend is not over until it is over, after all.

In the meantime, keep an eye on the strong resistance at 68.5c. If that were to be taken out convincingly, we could see 70c next.

Related post:

Golden Agriculture: A steeper trendline resistance.

Selling shares of Capitaland and CapitaMalls Asia.

I did a contra on the shares bought earlier in the week for Capitaland and CapitaMalls Asia yesterday. To me, the way in which the share prices were moving higher on lowering volume did not look sustainable.

Downtrends are rivers of hope, no doubt, but I would not get too hopeful especially if the technicals hint of a weak rebound. Lock in some gains and let others take on the higher risk of holding the shares in the downtrend.

If prices should go higher, congratulate the buyers. They took on greater risk and if they were to make money in the process, they deserve it.

Capitaland:

CapitaMalls Asia:

If prices were to move higher next week to test resistance provided by the longer term MAs, I would move to cut my long positions in these two counters, bearing in mind that their downtrends are very much intact.

I cut losses if prices rebound to test resistance and not when they are moving lower.

Related post:
The long awaited technical rebound.

Balancing AIMS AMP Capital Industrial REIT and Sabana REIT.

I have been kept busy the last couple of days. By the time I took a shower and called it a day, it was technically night since it was already past 11pm. It is the same thing today. Hopefully, I will be more settled in another week or so. Till then, I can only hope to blog more regularly.

So, what have I been doing in the stock market?

I increased my investment in Sabana REIT while reducing my investment in AIMS AMP Capital Industrial REIT. Having these REITs in equal weightage in my portfolio is an aim of mine. This is something I said I would be doing in an earlier blog post too. If you missed it, read it here. That was just last month.

At that time, AIMS AMP Capital Industrial REIT was trading at 20.5c/unit while Sabana REIT was trading at 91c/unit. Today, they are trading at 22c/unit and 93c/unit respectively. In the last few weeks which saw a bloodbath in the stock market, they have appreciated in price. How's that for resilience and, dare I say, capital gains?

More importantly, it has made the reason to balance my investments in the two REITs more compelling. A gain of 1c from 20.5c to 21.5c is a gain of 4.88%. A gain of 1.5c from 91c to 92.5 is a lesser gain of 1.65%. So, partially divesting AIMS AMP Capital Industrial REIT and buying more units of Sabana REIT makes even more sense now (i.e. sell the former at 21.5c and buy the latter at 92.5c).

The DPU of AIMS AMP Capital Industrial REIT is 2c. With unit price increasing from 20.5c to 21.5c, it means distribution yield decreasing from 9.76% to 9.3%.

The DPU of Sabana REIT is 8.81c. With unit price increasing from 91c to 92.5c, it means distribution yield just decreasing from 9.68% to 9.52%.

See how the distribution yield of Sabana REIT is now higher than that of AIMS AMP Capital Industrial REIT when just a few weeks ago it was lower? This is attractive to me as Sabana REIT's numbers are stronger and more of its properties are of better quality too. You can also say that the lower distribution yield of AIMS AMP Capital Industrial REIT tipped the scales even more in favour of Sabana REIT now.

I have been putting sell orders at 22c for AIMS AMP Capital Industrial REIT but they were, unfortunately, not filled. At 22c, its distribution yield would be 9.09% and even if I were to buy units in Sabana REIT at 93c, the distribution yield would be a more attractive 9.47%.

Finally, if you are wondering how I managed to buy any Sabana REIT units at 92.5c today when it traded at 93c, I didn't buy any today. I bought yesterday and the day before.

The long awaited technical rebound.

I keep saying that downtrends are rivers of hope and that prices do not go down in a straight line. This is quite natural but in despair and desperation, it is all too easy to give up and throw in the towel. This is capitulation.

Capitaland and CapitaMalls Asia are both in downtrends. This is quite obvious. With no signs of reversals to the upside, I recently added to my long positions with the simple believe that they are very oversold and technical indicators were prime for a technical rebound.

Of course, there was no way to know if or when the technical rebound was going to take place. However, the feeling was that any further downside could be limited in case a rebound did not take place anyway.

Now that the rebound has happened, it is important not to become delusional to think that prices could continue going up to hit the old highs. With the downtrend intact, the thing to do is to sell if resistance levels are tested. The question is at what price levels do we sell at? Well, my way is to search out the resistance levels and I see $2.91 and $2.94 for Capitaland.

Wait a minute, do I not think the share price could go higher to test resistance provided by the trendline which is approximating $3.20? Well, it could, of course, but that is a long shot and, bearing in mind that I added to my long position recognising the strong downtrend the counter is in, the thing to do is to lock in gains and to reduce exposure.

What about CapitaMalls Asia? Well, I am still hopeful that its share price could do a gap cover at $1.55. However, I also recognise that we could find resistance at $1.50 to be quite significant.

Therefore, locking in gains at $1.50 would be a good idea if it were to be tested. Let's see how things turn out tomorrow.

Related posts:
Capitaland: Average buy price of $2.81.
CapitaMalls Asia: Bought at $1.37.

STI rises 1.3% to 3,053.51 at closing
Tuesday, 21 June 2011

© 2011 - The Edge Singapore

CapitaLand to double portfolio in China in 5 years, Lim says: Update
Tuesday, 21 June 2011

© 2011 - The Edge Singapore