A warm welcome to 4 new subscribers who joined us since the last blog post. Thank you!
For regular readers of this blog, you would know that I believe in using “reversion to mean approach” to determine my buy price for Reits. And Reits is a major component of my portfolio since I am an income investor.
To explain it further, I basically track the dividend yields of Reits for the past years and then use the data to determine the historical yields of the Reit. By lining them up from lowest to the highest yields, I distributed them on a scale of 0-100%. 50% point is the mean. I designated 33% point as my “solid sell” trigger and 67% as my “solid buy” trigger.
The percentage of the scale will be higher if the yield is higher, created either by a depressed share price or a higher dividend distribution. Since share price fluctuates more frequently than dividend distribution, it is more likely that the window will open up because of depressed share price. Thus, by buying at “67%” point, I am buying at low share price for the same dividend yield and therefore, I feel more assured of getting the dividend yield return that I wanted. I must admit sometimes I am impatient, so I have bought the shares at 50% point too.
I will watch the yields of the Reit on this scale of 0-100% regularly. I update the share price of the Reits weekly. Furthermore, whenever, a Reit announced its results, I will update its dividends declared. I keep a rolling last 4 quarters dividend distribution to determine the yields.
Once, the yields reach my target of “67%”, I will move in to accumulate. I must admit that I am less disciplined at the sell trigger. But it is just me being greedy, hoping for an even higher share price.
Move on SGR
Recently, I moved to accumulate more Starhill Global Reit (SGR) shares.
Following the latest results announcement, SGR share price has been battled down with a bleaker outlook and a lower dividend distribution. The share price finally hit my “67%” point at 69 cents.
I have increased weightage of SGR in my portfolio from 5.1% to 5.6%.
So far, the decline has stopped and I hope things will improve from here, fingers crossed.
What else moved:
The other MOVE that I made happened today – on Netlink Trust. I accumulated more shares at 78.5 cents, when its share price dropped after ex-div. I don’t think anything major has changed to warrant this drastic drop. The weightage of Netlink Trust in my portfolio has since risen from 2.0% to 3.0%. I am fairly certain that it can continue to provide the 5+% yield to its shareholders. 5% yield from my portfolio is my target.
Have you made any changes to your portfolio? Look forward to hearing from you on the latest moves that you have made.
Enjoy the rest of the week.
- Dividend Play: Asian Pay TV & Netlink Trust
- Alternate REITs Buy Trigger = Reversion to Mean Dividend Yield
- Cracks appearing in Starhill Global Reit