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AIMS AMP Capital Industrial REIT: Partial divestment.

Thursday, January 19, 2012

Tomorrow will see the release of quarterly results for AIMS AMP Capital Industrial REIT. As if in anticipation of a good set of numbers, its unit price pushed higher today on higher volume, closing at $1.00.

Last month, I accumulated units of the REIT at 93.5c, 94c and 95c. Why did I buy? At those prices, the REIT was very undervalued. Indeed, I was waiting to accumulate at 92c too but the lowest it went to was 92.5c. I blogged about it: here.

Today, my overnight sell order at 99c was filled, locking in some gains. I believe the REIT is still undervalued and I sold not because of valuation concerns. Then, why did I sell?

I sold because I want to rebalance my portfolio. With the acquisitions I made last month, the REIT's weight in my portfolio has tipped somewhat. Also, technically, $1.00 seems to be the upper end of a trading range. So, divesting partially, closer to resistance, makes sense.

Notice how the Stochastics has stayed in overbought territory for quite a long time now. In a range bound situation, the risk of a downward movement in price is, therefore, higher. However, in very bullish circumstances, momentum oscillators could stay overbought for a long time. In case resistance at $1.00 is taken out, I expect resistance provided by the 200dMA at $1.02 to come into play.

My remaining investment in the REIT is still a substantial part of my core investment for passive income. This is unlikely to change.


SnOOpy168 said...

Congrats AK. A nice fat ang pow for you by Mr Market.

Wishing you, Happy & SUPER HUAT Dargon New Year.

Looking forward to your next & regular updates soon.

AK71 said...

Hi SnOOpy168,

Thank you. It has been a while since I got to make some money from trading. :)

Gong Xi Fa Cai!

INVS 2.0 said...

Hi AK71,

Congrats to you!

I managed to sell a fraction of my holdings at $1 this morning. A nice red packet from AIMS! :D

AK71 said...

Hi INVS 2.0,

You sold exactly at resistance. Congratulations! :)

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