https://mystocksinvesting.com Sat, 24 Oct 2020 14:31:28 +0000 en-US hourly 1 https://mystocksinvesting.com/wp-content/uploads/2020/10/cropped-squiare-3-32x32.png https://mystocksinvesting.com 32 32 Singapore REIT Fundamental Analysis Comparison Table Oct 24 – 2020 https://mystocksinvesting.com/singapore-reits/singapore-reit-fundamental-analysis-comparison-table-oct-24-2020/ https://mystocksinvesting.com/singapore-reits/singapore-reit-fundamental-analysis-comparison-table-oct-24-2020/#comments Sat, 24 Oct 2020 13:39:55 +0000 https://mystocksinvesting.com/?p=12965 Technical Analysis of FTSE ST REIT Index (FSTAS8670)

FTSE ST Real Estate Investment Trusts (FTSE ST REIT Index) decreased slightly from 854.51 to 822.03 (-3.80%) compared to last month update. REIT Index has rebounded c45% as of Sep 21 from the bottom on Mar 23, 2020.

Currently the REIT index is currently trading on sideway consolidation, sandwiched between a very tight range between 817 support and 871 resistance. There is a Bollinger Band Squeeze with very tight range and low volatility on FTSE ST REIT Index. The index can start big move in either direction.

There was a false Golden Cross 20D/50D/200D SMA breakout and unable to kick start the uptrend of the REIT index. Currently REIT index is trading near to the critical support at about 817.

As for now, Short term direction: Sideway, until breakout of the resistance (starts up trend) or breakdown of the support (starts down trend).

Previous chart on FTSE ST REIT index can be found in the last post Singapore REIT Fundamental Comparison Table on Sep 21, 2020.

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Money and Me: Yield Generating Asset Classes https://mystocksinvesting.com/singapore-reits/singapore-reits-market-outlook/money-and-me-yield-generating-asset-classes/ https://mystocksinvesting.com/singapore-reits/singapore-reits-market-outlook/money-and-me-yield-generating-asset-classes/#respond Mon, 19 Oct 2020 10:56:11 +0000 https://mystocksinvesting.com/?p=12953 16 October 2020 

Money and Me: Yield Generating Asset Classes
Michelle Martin speaks to Kenny Loh, REIT specialist and Independent Financial Advisor to discuss the REIT earnings season, Keppel DC REIT, Capitaland Commercial Trust, Asian stocks v US stocks with volatility ahead of the US elections, US President Trump proposing to add Chinese companies to a blacklist, issues ahead for Tencent and ANT Group and sectors to look out for.

  • Q3 2020 REITs earning season
  • US stocks in light of the upcoming elections
  • REIT sectors to look out for

 

 
 

 

Listen to his previous market outlook interviews here:

 

Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 
 
You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement
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Q3 REIT Earning Starts, Is It the Right Time to buy REITs? https://mystocksinvesting.com/singapore-reits/market-update/q3-reit-earning-starts-is-it-the-right-time-to-buy-reits/ https://mystocksinvesting.com/singapore-reits/market-update/q3-reit-earning-starts-is-it-the-right-time-to-buy-reits/#respond Sun, 11 Oct 2020 11:00:03 +0000 https://mystocksinvesting.com/?p=12936 We are entering into the REIT earning season now. 

The following are the Result Announcement Date for 3Q 2020 

  • SoilbuildBizReit (SV3U.SI) – 15 Oct
  • Keppel Reit (K71U.SI) – 19 Oct
  • Mapletree Log Tr (M44U.SI) – 19 Oct
  • Keppel DC Reit (AJBU.SI) – 20 Oct
  • CapitaCom Trust (C61U.SI) – 21 Oct BMO
  • KepPacOakReitUSD (CMOU.SI) – 21 Oct
  • CapitaMall Trust (C38U.SI) – 22 Oct BMO
  • Mapletree Com Tr (N2IU.SI) – 22 Oct
  • Mapletree Ind Tr (ME8U.SI) – 27 Oct
  • Mapletree NAC Tr (RW0U.SI) – 29 Oct
  • Frasers HTrust (ACV.SI) – 30 Oct
  • Frasers Cpt Tr (J69U.SI) – 3 Nov BMO
  • Frasers L&C Tr (BUOU.SI) – 6 Nov BMO

I have also conducted a Poll on my Telegram Channel and about 44% has a Bullish outlook.  You can join the Poll here for the latest result and check out the sentiment of your fellow investors. https://t.me/REITirement

It is expected the Q3 earning result is better than Q2 earning result after the re-opening of the economy. It is also expected the REITs will pay a higher dividend than the last quarter. Will this improvement of the DPU payout kick start the next bull run in the REIT index? If you have missed out the 1st bull run 40% bull run, This may the 2nd chance for the investors to invest in Singapore REITs before the share prices start to move up.

The following is the Q4 2020 S-REIT Market Outlook I have presented to 400- 500 investors for the past 2 weeks.

  • Singapore entered COVID-19 Phase 3 opening. Is this a good time to invest in REITs? 
  • “Be greedy when others are fearful” according to Warren Buffett. What are the opportunities out there in the REIT market now? Do you know how to identify them? Or are you going to miss the boat again?
  • I am organising a REIT course teaching investors to capture the opportunities in REIT before the next bull run on Sat 17 Oct, 9am – 5pm (Singapore time). This is the only one and the last one in 2020. 
  • This is a Physical F2F & Hands on Class since the circuit breakers ! As seats are very limited due to social distancing requirements, please register ASAP so as not to miss out this 2nd opportunity to invest in REITs at current COVID price.
  • More details and register for this classroom training at (Promo Code: KENNYLOHREITS for discount as my blog followers): 

https://www.eventbrite.sg/e/reits-programme-by-kenny-loh-tickets-122052579551?discount=kennylohreits

See other popular articles here.

Singapore REIT Fundamental Analysis Comparison Table Sep 21 – 2020

Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 

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Singapore REIT Fundamental Analysis Comparison Table Sep 21 – 2020 https://mystocksinvesting.com/singapore-reits/singapore-reit-fundamental-analysis-comparison-table-sep-21-2020/ https://mystocksinvesting.com/singapore-reits/singapore-reit-fundamental-analysis-comparison-table-sep-21-2020/#respond Mon, 21 Sep 2020 13:01:42 +0000 https://mystocksinvesting.com/?p=12888 Technical Analysis of FTSE ST REIT Index (FSTAS8670)

TSE ST Real Estate Investment Trusts (FTSE ST REIT Index) increased slightly from 835.40 to 854.51 (+2.28%) compared to last month update. REIT Index has rebounded c45% as of Sep 21 from the bottom on Mar 23, 2020.

Currently the REIT index is currently trading on sideway consolidation, sandwiched between a very tight range between 817 support and 854 resistance. There is a Bollinger Band Squeeze with very tight range and low volatility on FTSE ST REIT Index. The index can start big move in either direction.

There is a Golden Cross of 20D SMA above 200D SMA and the REIT index has moved above all the 3 moving averages.

As for now, Short term direction: Sideway and up (if REIT index can stay above all the 3 moving averages of 20D/50D/200D.

Previous chart on FTSE ST REIT index can be found in the last post Singapore REIT Fundamental Comparison Table on Aug 16, 2020.

 

Fundamental Analysis of 41 Singapore REITs

The following is the compilation of 41 REITs in Singapore with colour coding of the Distribution Yield, Gearing Ratio and Price to NAV Ratio.

  • Note 1: The Financial Ratio are based on past data and there are lagging indicators.
  • Note 2: This REIT table takes into account the dividend cuts due to COVID-19 outbreak. Yield is calculated trailing twelve months (ttm), therefore REITs with delayed payouts might have lower displayed yields, thus yield displayed might be lower.

This image has an empty alt attribute; its file name is sep-table-864x1024.png

  • Price/NAV increased from 0.92 to 0.96 (Singapore Overall REIT sector is undervalued now).
  • Distribution Yield decreased slightly from 6.56% to 6.49% (take note that this is lagging number with better visibility after Q2 earning release). About 39.0% of Singapore REITs (16 out of 41) have Distribution Yield > 7%. Do note that these yield numbers are based on current prices taking into account the delayed distribution/dividend cuts due to COVID-19.
  • Gearing Ratio maintains at 36.61%.  In general, Singapore REITs sector gearing ratio is healthy. Note: Gearing may be affected (i.e. potential increase) as the valuation of the portfolio would be reduced.
  • The most overvalued REITs are Keppel DC REIT (Price/NAV = 2.59), followed by Mapletree Industrial Trust (Price/NAV = 2.07), Parkway Life (Price/NAV = 2.21), Mapletree Logistic Trust (Price/NAV = 1.69) and Ascendas REIT (Price/NAV = 1.54).
  • The most undervalued REITs (based on NAV) are Eagle Hospitality Trust* (Price/NAV =0.17), followed by ARA Hospitality Trust (Price/NAV = 0.40), Lippo Malls Indonesia Retail Trust (Price/NAV = 0.41), Starhill Global (Price/NAV = 0.56) and Frasers Hospitality Trust (Price/NAV = 0.60)
  • The Highest Distribution Yield (TTM) is First REIT (14.51%), followed by Lippo Malls Indonesia Retail Trust (11.49%), ARA Hospitality Trust (9.19%), EC World REIT (8.40%), KepPacOak US REIT (8.31%), Prime US REIT (8.08%) and ESR REIT (8.01%). Reminder that these yield numbers are based on current prices taking into account delayed distribution/dividend cuts due to COVID-19. Some REITs opted for semi annual reporting and thus no quarterly DPU was announced.
  • The Highest Gearing Ratio REITs are ARA US Hospitality Trust (42.5%), ESR REIT (41.8%), Suntec REIT (41.3%), ARA Logos Log Trust (40.4%) (previously Cache Log Trust) and OUE Commercial REIT (40.1%)
  • Total Singapore REIT Market Capitalisation = S$102 Billion.
  • Top 5 REITs with biggest market capitalisation are Ascendas REIT ($11.87B), Mapletree Industrial Trust ($7.87B), Mapletree Logistics Trust ($7.81B), CapitaMall Trust ($7.49B) and Mapletree Commercial Trust ($6.69B).
  • The bottom 5 REITs with smallest market capitalisation are Eagle Hospitality Trust ($119M), BHG Retail REIT ($283M), United Hamsphire REIT ($286M), ARA Hospitality Trust ($238M) and Elite Commercial REIT ($361M)
  • *Eagle Hospitality Trust is currently suspended

Disclaimer: The above table is best used for “screening and shortlisting only”. It is NOT for investing (Buy / Sell) decision. To learn how to use the table and make investing decision, Sign up next REIT Investing Workshop here to learn how to choose a fundamentally strong REIT for long term investing for passive income generation.

Top 20 Performance of the Month (Source: https://stocks.cafe/kenny/advanced)

 

SG 10 Year & US 10 Year Government Bond Yield

  • SG 10 Year: 0.882%
  • US 10 Year: 0.70%

Summary

Fundamentally the whole Singapore REITs is undervalued now based on simple average on the Price/NAV. The REIT index is powered by the big cap Industrial sectors such as Keppel DC REIT, Ascendas REIT, Mapletree Industrial Trust, Mapletree Logistic Trust, Frasers Logistic & Commercial Trust and Parkway Life REIT.

(Source: https://stocks.cafe/kenny/overview)   

Retail & Hospitality sectors, small & medium cap REITs are very attractive based on the NAV. However, do take note that NAV would probably be adjusted downward caused by the devaluation of property value. We have already seen the NAV of some REITs are adjusted downward and the increase of gearing ratio, from the latest earning release or business update.

Yield spread (reference to 10 year Singapore government bond of 0.882%) has decreased slightly from 5.665% to 5.608%. The risk premium are still attractive to accumulate Singapore REITs in stages to lock in the current price and long term yield after the recovery.

Technically the REIT Index is currently trading on sideway consolidation with low volatility until the breakout. The breakout may happen in the coming earning season starts in coming October. Current macro factors such as low interest rate environment and recovery of global economic support the bullish breakout.

Note: This above analysis is for my own personal research and it is NOT a buy or sell recommendation. Investors who would like to leverage on my extensive research and years on REIT investing experience can approach me separately for REIT Portfolio Consultation.

 

My Physical REIT Class is back! This is The ONLY ONE class in Q4 this year. The best learning is still through the class room learning. Seats are limited due to social distancing requirement, please register ASAP (Promocode: KENNYLOHREITS) https://www.eventbrite.sg/e/reits-programme-by-kenny-loh-tickets-122052579551

 

Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 
 
You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement
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Shariah Investment Screening Methodology https://mystocksinvesting.com/islamic-financial-planning/shariah-investment/shariah-investment-screening-methodology/ https://mystocksinvesting.com/islamic-financial-planning/shariah-investment/shariah-investment-screening-methodology/#respond Sat, 05 Sep 2020 06:47:41 +0000 https://mystocksinvesting.com/?p=12876 I received many inquiries since my last articles on the Shariah Investment, I use this opportunity to explain how Muslim can use the Shariah Compliant Rulebook to conduct the screening and monitor the Shariah Compliant-ness of their investment regularly.

Shariah Investment in Singapore.

Is Halal Earning with Investment Possible?

Shariah Compliant Rulebook

There are 2 important aspects to ensure the investment is Shariah Compliant (a) Business Activities (b) Financial

Business To Avoid:
Investment is not allowed in companies generating income from any of the following activities:
• Adult Entertainment
• Alcohol
• Cinema
• Defense & Weapons
• Financial services (insurance, conventional banking, conventional financial institutions, mortgage, etc.)
• Gambling
• Gold and silver hedging
• Interest-bearing investments
• Music
• Pork
• Tobacco


Financial Screening:
• Total sum of non-permissible income should not exceed 5% of the total
income generated by the company
• Total sum of interest-bearing cash and investments should not exceed 30% of the preceding 12-months average market capitalization
• Total sum of interest‐bearing debts should not exceed 30% of the preceding 12-months average market capitalization
• No investment in fixed income preferred shares is allowed


Purification Methodology:
• Investment Purification
Investor purifies the non-permissible income per share regardless of any capital gain, dividend distribution, or compliance status for the stock.

Example #1: Apple

Apple is Shariah compliant as the stock passes Business Activity and Financial. If Muslim investors have invested in Apple shares, investors can keep the capital gain but dividends have to be donated away (according to the purification methodology).

Example #2: DBS Bank

DBS Bank is not Shariah compliant as the stock fails Business Activity due to Non-permissible income (i.e. Riba in this case) and Financial due to interest bearing investment and debts. If Muslim investors have invested in DBS Bank, all capital gain and dividends have to be donated away.

Muslim investors who would like to make sure your investment portfolio is Shariah compliant, you may write to Kenny Loh (email: kennyloh@fapl.sg) to have a Shariah Compliant Portfolio Review.

Kenny Loh is a Senior Consultant and Certified Islamic Wealth Advisor of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 

You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement

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Correlation Analysis of Price/NAV of S-REITs to other factors https://mystocksinvesting.com/singapore-reits/correlation-analysis-of-price-nav-of-s-reits-to-other-factors/ https://mystocksinvesting.com/singapore-reits/correlation-analysis-of-price-nav-of-s-reits-to-other-factors/#comments Sun, 30 Aug 2020 02:56:00 +0000 https://mystocksinvesting.com/?p=12855 REITs have many unique values, from Financial Ratios to Debt values to Market Performance (such as Occupancy Rates etc). In this article, we will be using some statistical measurements to understand the correlation of several factors that a REIT would have, and the Price/Net Asset Value (NAV) of the S-REIT market.

Each of the following graphs shows the individual plot of each REIT, to create a graph that visualises the S-REIT market. Data used is collected and compiled from the StocksCafe REIT screener.

Note: The following analysis is based on observations. Correlation Causation, hence it is not a predictor of future stock movements. Read the Disclaimer for more details. You can also find out more about what the R-squared value means here.

Objective:

To understand the correlation of the other REIT factors to the Price/NAV value.
There are several values that show a correlation between the Price/NAV value of the REIT. Below are some examples:

Price/NAV vs Interest Coverage Ratio

Interest Coverage Ratio (ICR) is one of the financial ratios that displays a correlation with the Price/NAV value.

Graph of Price/NAV vs Interest Coverage Ratio, 28 Aug 2020

With a R-squared value of 0.5251, this displays a relatively strong correlation between the 2 values. Using the y=mx+c equation, the positive m value of 0.1114 means a positive correlation, that a higher Interest Coverage Ratio is correlated to a higher Price/NAV ratio.

This could possibly be explained that since a higher Interest Coverage Ratio means a healthier financial position.

Price/NAV vs Market Cap

Market cap is another one of the financial ratios that displays a correlation with the Price/NAV value.

Graph of Price/NAV vs Market Cap, 28 Aug 2020

With a R-squared value of 0.3488, this displays a reasonable correlation between the 2 values, albeit not as strong as Price/NAV vs Interest Coverage Ratio. Using the y=mx+c equation, the positive m value means a positive correlation, that a higher Market Cap is correlated to a higher Price/NAV ratio.

This could possibly be explained that since higher Market Capitalisation consistent increase in share value and dividend payments

Price/NAV vs Weighted Average Lease Expiry (WALE)

However not all factors are not correlated to the Price/NAV value of the REIT. For example, rental-related values such as WALE and Occupancy Rates do not show a correlation to the Price/NAV value. The following is the graph for Price/NAV to WALE:

Graph of Price/NAV vs Weighted Average Lease Expiry (WALE), 28 Aug 2020

With a very low R-squared value of 0.0651, it does not show a correlation between the 2 values, with values all over the place. Thus, it can be said that there does not seem to be any correlation between WALE and the Price/NAV value.

Price/NAV vs Occupancy Rate

The same can be said with Occupancy Rate, as seen with the graph below:

Graph of Price/NAV vs Occupancy (%), 28 Aug 2020

With a very low R-squared value of 0.06636, it does not show a correlation between the 2 values, with values all over the place. Thus, it can be said that there does not seem to be any correlation between the Occupancy Rate and the Price/NAV value.

The following table shows the Top 10 Singapore REITs with highest Interest Coverage Ratio. For data, please refer to Stocks Cafe REITs Screener.

Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement

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Are you SABOing your Investment for Retirement? https://mystocksinvesting.com/lessons-learnt/are-you-saboing-your-investment-for-retirement/ https://mystocksinvesting.com/lessons-learnt/are-you-saboing-your-investment-for-retirement/#respond Fri, 28 Aug 2020 02:15:00 +0000 http://mystocksinvesting.com/?p=10970 It is a very unfortunate event that investors lost their hard earned money and retirement fund with Six Capital.

Angry investors file police reports against fintech firm SixCapital

What can we as the retail investors learn from this incident?

Let’s use the SABO model to analyse this incident. By the way, this SABO is NOT the Singlish of “Sabotage”.

SABO stands for S (Suitability), A (Affordability), B(Benefit) and O(Objective).

 

Objective

Before we invest, we need to have a very clear objective in mind on why we need to invest, how long is our investment horizon, what is our risk profile, how much time we can allocate to monitor our investment portfolio, etc.. Setting the right objective is very important because it serves as our lighthouse to identify, select and understand the right asset classes to meet our objective.

 

Suitability

Once we are clear with the objective, the next step is to select the asset classes which are suitable to our risk appetite, our life style, available time to do our homework and investment horizon.

Examples of the wrong match of one life style, personality, risk appetite with wrong asset classes and investment strategy:

  • a busy executive scalps forex every night after work;
  • a retiree invests his / her majority of retirement fund in land banking;
  • a person who dislikes numbers trades Option
  • a housewife who does not have computer knowledge trades crytocurrency

It is not sustainable with all the above examples due to the mismatch.

If you are struggling with your current investment, it is strongly suggested you do a review immediately on your current investment portfolio or your trading strategy, before you commit more time and more money doing something which is not suitable to you.

The following questions the investors have to ask to see whether the investment is suitable to them :

  • How the investment strategy can give 18% per year?
  • What are the risks in this investment?
  • What is the worst case scenario?
  • How volatile is this investment?
  • How quickly if the investors want to redeem their investment? Is there a lock in period? Are there any early redemption and other charges?

 

 

Affordability

  • Can we afford to lose all our investment if we make mistake investing in the wrong asset classes or instrument?
  • Can we afford to ride through the market volatility if there is a big correction or black swan event?
  • Can we afford to take more risk for higher return?
  • Can we afford to be ignorant, DIY and listen to tips when come to investing?
  • Can we afford to get professional advice to help building the safe and diversified portfolio?

 

Benefits

  • Is the return of the  investment meet my expectation?
  • Is my expectation realistic?
  • Is it worth to take more risk for additional return?
  • Is my investment liquid and sell anytime when I need money?
  • Can the investment give me Peace of Mind and give me a “Sleep Well” factor?

 

I am rather concern with this statement “A few retirees indicated that they had poured in significant retirement sums. One lady was the age of my mother. She said that she was going to the temple to pray.”

My recommendation to retiree on their retirement fund:

  • First priority is Capital Preservation, Not Chasing for Return because you can’t afford to lose your retirement fund unless you can replenish your capital easily if you lose all of them.
  • Look for investments which are less volatile and pay consistent dividend like Bond or REITs.
  • Nothing is guaranteed in this investment world. Please don’t believe in those marketing materials indicate “Guaranteed Return”, etc. Countries, Banks, Insurance companies can all go bankrupt.. so, where does the guarantee come from?
  • Do have a diversified investment portfolio and Manage the Risk… Don’t put all your eggs into one basket. You cannot afford to make any costly mistake at retirement age. One big mistake may wipe out all your retirement fund.

 

If you need an Independent Third Party to have an unbiased view on  your current investment portfolio (Fee based), you can contact me through email kennyloh@fapl.sg.

 

Scope of the Investment Portfolio Review

  • Identify your Investment Objective
  • Risk Profile Assessment
  • Strength and Weakness of current portfolio
  • Recommendation

 

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Money and Me: The REIT outlook within and beyond Singapore https://mystocksinvesting.com/singapore-reits/singapore-reits-market-outlook/money-and-me-the-reit-outlook-within-and-beyond-singapore/ https://mystocksinvesting.com/singapore-reits/singapore-reits-market-outlook/money-and-me-the-reit-outlook-within-and-beyond-singapore/#respond Fri, 21 Aug 2020 07:07:41 +0000 https://mystocksinvesting.com/?p=12502 18 August 2020 

Money and Me: The REIT outlook within and beyond Singapore
Michelle Martin speaks to Kenny Loh, REIT Specialist and Independent Financial Advisor to discuss the S-REIT space, Sasseur REIT, gold mining stocks, and sweet spots on the local and regional  S-REIT index.

  • S-REITs performance compared to other asset classes
  • Outlooks of some overseas REITs
  • Mapletree Industrial Trust’s move towards datacentres

 

 

Listen to his previous market outlook interviews here:

 

Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 
You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement
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Singapore REIT Fundamental Analysis Comparison Table Aug 16 – 2020 https://mystocksinvesting.com/singapore-reits/singapore-reit-fundamental-analysis-comparison-table-aug-16-2020/ https://mystocksinvesting.com/singapore-reits/singapore-reit-fundamental-analysis-comparison-table-aug-16-2020/#respond Sun, 16 Aug 2020 15:08:41 +0000 https://mystocksinvesting.com/?p=12419 Technical Analysis of FTSE ST REIT Index (FSTAS8670)

FTSE ST Real Estate Investment Trusts (FTSE ST REIT Index) has little changes from 837.43 to 835.40  (-0.35%) compared to last month update. REIT Index has rebounded c43% as of Aug 16 from the bottom on Mar 23, 2020.

Currently the REIT index is currently trading on sideway consolidation, sandwiched between 800 support and 860 resistance. There is a Bollinger Band Squeeze with very tight range and low volatility on FTSE ST REIT Index. The index can start big move in either direction.

As for now, Short term direction: Sideway.

Previous chart on FTSE ST REIT index can be found in the last post Singapore REIT Fundamental Comparison Table on July 12, 2020.

 

Fundamental Analysis of 41 Singapore REITs

The following is the compilation of 41 REITs in Singapore with colour coding of the Distribution Yield, Gearing Ratio and Price to NAV Ratio.

  • Note 1: The Financial Ratio are based on past data and there are lagging indicators.
  • Note 2: This REIT table takes into account the dividend cuts due to COVID-19 outbreak. Yield is calculated trailing twelve months (ttm), therefore REITs with delayed payouts might have lower displayed yields, thus yield displayed might be lower.

 

  • Price/NAV decreased from 0.93 to 0.92 (Singapore Overall REIT sector is undervalued now).
  • Distribution Yield increased from 5.31% to 6.56% (take note that this is lagging number with better visibility after Q2 earning release). About 43.9% of Singapore REITs (18 out of 41) have Distribution Yield > 7%. Do note that these yield numbers are based on current prices taking into account delayed distribution/dividend cuts due to COVID-19.
  • Gearing Ratio maintains increase slightly from 36.47% to 36.61%.  In general, Singapore REITs sector gearing ratio is healthy. Note: Gearing may be affected (ie. potential increase) as the valuation of the portfolio would be reduced.
  • The most overvalued REITs are Keppel DC REIT (Price/NAV = 2.50), followed by Mapletree Industrial Trust (Price/NAV = 1.84), Parkway Life (Price/NAV = 1.82), Mapletree Logistic Trust (Price/NAV = 1.67) and Ascendas REIT (Price/NAV = 1.62).
  • The most undervalued REITs (based on NAV) are Eagle Hospitality Trust* (Price/NAV =0.17), followed by ARA Hospitality Trust (Price/NAV = 0.44), Lippo Malls Indonesia Retail Trust (Price/NAV = 0.44), Far East HT (Price/NAV = 0.58) and Starhill Global (Price/NAV = 0.55)
  • The Highest Distribution Yield (TTM) is First REIT (11.09%), followed by Lippo Malls Indonesia Retail Trust (10.83%), Prime US REIT (8.66%), ARA Hospitality Trust (8.38%) and Cromwell REIT (8.59%). Reminder that these yield numbers are based on current prices taking into account delayed distribution/dividend cuts due to COVID-19. Some REITs opted for semi annual reporting and thus no quarterly DPU was announced.
  • The Highest Gearing Ratio REITs are ARA US Hospitality Trust (42.5%), ESR REIT (41.8%), Suntec REIT (41.3%), ARA Logos Log Trust (40.4%) (previously Cache Log Trust) and OUE Commercial REIT (40.1%)
  • Top 5 REITs with biggest market capitalisation are Ascendas REIT ($12.5B), Mapletree Logistics Trust ($8.1B), CapitaMall Trust ($6.9B), Mapletree Commercial Trust ($6.3B) and Capitaland Commercial Trust ($6.3B)
  • The bottom 3 REITs with smallest market capitalisation are Eagle Hospitality Trust ($119M), BHG Retail REIT ($290M), United Hamsphire REIT ($286M), ARA Hospitality Trust ($264M) and Elite Commercial REIT ($401M)
  • *Eagle Hospitality Trust is currently suspended

Disclaimer: The above table is best used for “screening and shortlisting only”. It is NOT for investing (Buy / Sell) decision. To learn how to use the table and make investing decision, Sign up next REIT Investing Workshop here to learn how to choose a fundamentally strong REIT for long term investing for passive income generation.

 

Top 20 Performance of the Month (Source: https://stocks.cafe/kenny/free)

 

REIT Sectors Performance (Source: https://stocks.cafe/kenny/overview)

 

Singapore SIBOR Rate Watch

  • 1 month stays at 0.25000%
  • 3 month decreases from 0.43900% to 0.43775%
  • 6 month decreases from 0.62450% to 0.62375%
  • 12 month decreases from 0.96725% to 0.87550%

 

Summary

Fundamentally the whole Singapore REITs is undervalued now based on simple average on the Price/NAV. The REIT index is powered by the big cap Industrial sectors such as Keppel DC REIT, Ascendas REIT, Mapletree Industrial Trust and Mapletree Logistic Trust. See 4 Heavenly Kings REIT here.  Retail & Hospitality sectors, small & medium cap REITs are very attractive based on the NAV. However, do take note that NAV would probably be adjusted downward caused by the devaluation of property value. We have already seen the NAV of some REITs are adjusted downward and the increase of gearing ratio, from the latest earning release or business update.

Yield spread (reference to 10 year Singapore government bond of 0.895%) has increased from 4.414% to 5.665%. The risk premium are still attractive to accumulate Singapore REITs in stages to lock in the current price and long term yield after the recovery.

Technically the REIT Index is currently trading on sideway consolidation with low volatility until the breakout either above 860 resistance and 800 support. Current macro factors such as low interest rate environment and recovery of global economic support the bullish breakout.

 

Note: This above analysis is for my own personal research and it is NOT a buy or sell recommendation. Investors who would like to leverage on my extensive research and years on REIT investing experience can approach me separately for REIT Portfolio Consultation.

 

Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 
You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement
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1H 2020 Singapore – 4 Heavenly King REITs Award https://mystocksinvesting.com/singapore-reits/1h-2020-singapore-4-heavenly-king-reits-award/ https://mystocksinvesting.com/singapore-reits/1h-2020-singapore-4-heavenly-king-reits-award/#respond Sat, 01 Aug 2020 14:04:30 +0000 https://mystocksinvesting.com/?p=12407 We have the 4 Heavenly King REITs in 2020!

The best performing REITs YTD 2020 are all from Industrial Sector.

  1. Keppel DC REIT
  2. Mapletree Industrial Trust
  3. Mapletree Logistic Trust
  4. Ascendas REIT

 

Market Cap Comparison – Source: Stock Cafe REIT Overview

 

Technical Charts – All 4 Heavenly King REITs broke NEW HIGH!

 

 

 

Fundamental Data Comparison – Source: Stock Cafe Kenny’s REIT Table

Interestingly, 3 of 4 Heavenly King REITs have Data Centers in their portfolio which command a huge premium to their book value.

  1. Keppel DC REIT (P/B =2.55)
  2. Mapletree Industrial Trust (P/B = 2.01)
  3. Mapletree Logistic Trust (P/B = 1.77)
  4. Ascendas REIT (P/B = 1.61)

 

Besides Data Center, another new sector and exciting asset class Student Accommodation will be coming to Singapore soon! I am organising an Education webinar on Aug 5,2020 to my loyal blog readers so that you guys have 1st hand information or training about this new sector Student Accommodation. The knowledge enables you to identify good investment opportunity if there is any.

As seats are VERY LIMITED in zoom webinar, please register ASAP!
Date: Aug 5, 2020 (Wednesday)
Time: 8 pm to 9:30pm
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The 4 Heavenly King REITs was first shared in the MoneyFM89.3 Interview.
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Kenny Loh is a Senior Consultant and REITs Specialist of Singapore’s top Independent Financial Advisor. He helps clients construct diversified portfolios consisting of different asset classes from REITs, Equities, Bonds, ETFs, Unit Trusts, Private Equity, Alternative Investments and Fixed Maturity Funds to achieve an optimal risk adjusted return. Kenny is also a CERTIFIED FINANCIAL PLANNER, SGX Academy REIT Trainer, Certified IBF Trainer of Associate REIT Investment Advisor (ARIA) and also invited speaker of REITs Sympsosium and Invest Fair. 
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You can join my Telegram channel #REITirement – SREIT Singapore REIT Market Update and Retirement related news. https://t.me/REITirement
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