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Saizen REIT: Insiders are accumulating again.

Tuesday, June 12, 2012

I read this in The Business Times just last evening:

CEO, Chang Sean Pey and executive director, Raymond Wong, acquired units in Saizen REIT this month with a combined 602,000 units purchased from 4 to 7 June at 14 cents each.

This is the CEO's first on-market trade since September 2011. The CEO now holds 3.65 million units or 0.26%. He acquired 2.02m units from March 2009 to September 2011 at an average price of 15.5c each.

Executive director, Raymond Wong, now has a deemed stake of 24.909m units or 1.74%. Prior to the acquisitions this month, he acquired 6.7m units from February 2009 to August 2010 at 10c to 17c each or an average of 14.3c each.

Also positive this quarter, executive director, Chan Kin, purchased 530,000 units on May 25 at 13c each. His deemed holdings increased to 185.041m units or 13.8%.

Of course, with insiders buying, it does not mean that the unit price is only going up from now.  However, do they know something we don't? Or do we know what they know but are unwilling to act like they have?

I do know Saizen REIT would be paying its half yearly income distribution in September. Is it going to be a bumper distribution?

Related posts:
1. Saizen REIT: Why did I buy and would I buy more?
2. Saizen REIT: Insiders buying again at 14c.
3. Saizen REIT: Acquisitions to increase DPU.


Jean Yap said...

Hi AK, May I know among all the reit u have, which one provide u the best income? Can we use CPF to invest on reit for long term? Thanks.


AK71 said...

Hi Jean,

I take it that you mean which one gives me the best yield?

Yield is a function of our entry price as well. So, the lower our prices, the higher the yields, everything else remaining equal.

I guess in order to be meaningful for you, we shall have to look at yields at current unit prices.

Sabana REIT and AIMS AMP Capital Industrial REIT top the list at the moment with distribution yields in excess of 9% per annum.

Recently, I bought more units of Saizen REIT when it was sold down. The distribution yield for Saizen REIT approximates 8% now which is rather attractive as it owns freehold residential properties in Japan.

Ray said...

Saizen is rising fast... Happy!

Didn't buy enough when it dropped earlier.... Sad!

To chase, or not to chase.
That's the question. LOL

AK71 said...

Hi Ray,

I also say! Should have emptied my war chest! ;p

Nah, I have a significant enough position in Saizen REIT after buying more when it went under 13c. It is once again one of my top 5 investments although not the largest like it was once upon a time.

The annual income distribution I will receive from Saizen REIT has quadrupled due to my recent acquisitions. This will contribute to more than 10% of my total income to be received from S-REITs in the year 2012, everything remaining equal.

This could be an example of how we should take advantage of sporadic market mispricings to add to fundamentally sound investments. :)

Ray said...

problem is when prices are dropping you dont know whether they will fall even more. The scary thought of averaging downwards keep people from buying until its too late.

AK71 said...

Hi Ray,

Hence, we should invest to a level we are comfortable with. If prices should go up higher from there, good for us. If prices should go lower from there, we have not emptied our war chest. :)

From my experience, people who do nothing and keep waiting, hoping for prices to go down even lower will never buy and almost always miss the boat. Why?

Who knows when prices hit bottom? When prices start to move up again, these people would say they should have bought and continue to wait. This is why double bottom formations are so powerfully predictive.

In the global financial crisis, many were waiting for 1,200 points on the STI before buying. I did not. I was lucky. Yes, lucky. Those who claim that it was 100% foresight are doing so on hindsight. ;)

A large part of TA is about understanding Mr. Market's psychology but we must also strive for understanding of our own psychology. :)

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