How to build your watchlist of Singapore REITs: video tutorial

Hi, welcome to this new video. Today the topic is real estate investment trust. Again, specifically we are looking at the Singapore market. Now what I want to do today is not really explaining how we evaluate REITs. I've already published videos about that. But actually what I want to show you is how you go through your watch list of REITs in order to decide what to do if you should buy or sell or hold. And I also want to show you the watch list that I have for this quarter. Because every time the REITs release financial information, usually every quarter, you need to check the fundamentals and you may have a different watch list. So this is the watch list that I have for the current quarter. You can see we have a few REITs is around 10 or let's see, 3, 6, 8, 12 REITs. And here you see the name followed by the type. So we have retail and then it can be in prime or suburban area. We have one hospitality, a few industrial, one healthcare. We don't have office REIT for this watch list because I didn't find any office rate that was good enough to be in the watch list. And then here you also see the geography. S means the properties are based in Singapore overseas or so means there is a mix of properties in Singapore and overseas. And then you see the yield. Now the yield is basically the percentage that you get in terms of dividends. Okay, so let's say you buy $100 of Maple Tree and then if this is the yield, it means that you get $4.48 in one year of dividends. Usually when I buy REITs I want to get at least 5.5% of dividend. And that's why I highlight in green those for which the yield is at least 5.5%. So let's go through this list and let's see if they are good worth having in the watch list or not. Let's start with the Mapletree commercial. Okay, is this one. Now what is the first thing you see here? Let's look at the three year chart. You can see that now the price is very overextended and it makes sense because the yield is low. Usually when the price is going up, then the yield will go down because the yield is the dividend over price. So this is a good one. Yes, but is it the right moment to buy? No, I will say now is very overextended. I will wait for the price at least to bounce back to this blue line that is the 50 moving average. So what I will do for this guy, Well I will Put it in my watch list and wait. Let's move on sph. Okay, sph, the chart is a little different. Notice however that we are near the all time high here, at least for three years. Another thing you can look at, I forgot to show you here, is this is this chart. If you remember from my video about how to value a reit, I say that I don't really like the discount dividend method, the absolute valuation method because the results are somehow inconsistent. I prefer to look at the price over nav, the historical range. And if you look at Mapletree commercial here and don't worry, I will put the link of this in the description together with the other resources that I will mention later. Mapletree commercial is here. So it's kind of fairly valued. You see that if you were looking at price over nav above 1 to decide if a REIT is overvalued, this guy will always be considered overvalued. But if you look at the historical range actually is kind of in the middle. Now what about sph? SPH is here and I would say SPH is a little on the upside. So again SPH I would say is not the ideal moment to buy. Now I will wait for the price to go down a little. But there is something that you should notice about SPH REIT is that they don't on many, many properties, I think three or four. So in terms of market cap and diversification it may be a concern. But anyway, if you are fine with that, you can put it again on your watch list. Notice something else here. If you are building a portfolio of REITs, it's a good idea to take reads from different types. Okay, so for example, if you want to take one read for each category, just choose one. Don't take like these three because they are good, just take the best. Let's move to this to the third one. Well, I don't think I need to comment anymore. Here is clearly overextended and it went up like crazy. And, and the good news is that if you look here, it seems that now is the price is going down. You see these bearish candles. So what I would like to see ideally is the price going down, keep going down, hitting the 50, moving average and then bouncing back. That could be a moment to buy provided the yield is good enough. Now the yield is 4.73, so it's not above my threshold, that is 5.5. So for now this as well can be put in our watch list. And if you look here, Fraser's center point Is here and you see is also not overvalued. It's in the lower range. So it's good. Let's move to Fortune reit. Okay, Fortune REIT is a little special read because it's actually you can buy in the Singapore Stock Exchange, but is trading in Hong Kong dollars. And it's a good read from the fundamental point of view is overextended now. But what I don't like about this read is that the candles are weird. You see, if you look at the volume here, you will realize that sometimes the volume is very low, like 14k or 30k. I don't know. For the long term, I prefer to avoid REITs having this kind of broken candles, you see. So this one I will. Even though the fundamentals are good, I will say no, let's move on to bhg. Bhg. Well, this one same problem is not trading in another country is Singapore. But look at the candles, you can see that they are really, really weird. And. And the volume is ridiculous sometimes. Like here is 100 shares, here is 0 is flat. So even this case, I will not even look at anything else. The yield may be good. I don't care if I see a chart like that. I rather avoid. So it's another no. And the point here that I want to make is that it's important of course to look at the fundamentals. And by the way, I will put in the description a link to my blog where you can download a free guide that is giving you some of the criteria you can use to screen out the REITs and then to get a watch list like this. Yeah, I was saying the fundamentals are important, but you also need to look at the technical. You cannot forget to check the chart because again, if this is the situation, it may be hard to enter at the price you want and especially exit at the price you want. Capital Retail China. Okay, this is a very good read, I have to say. And you see, already the chart is much better than before. There was a strong support here around 1.34 and now the price is here, you see, it seems there is some kind of resistance here. But I will say if it's bouncing around the 50 moving average, you can consider buying. Why? Because first, or you can even buy now a few reasons. Number one, as you see, the price is quite far from the historical high, at least in the three years. You can look at five or 10 years if you want. But the idea is that we are not really overextended. We are near the moving average. We look Here Capital retail China is not, I would say overvalued. It's actually below, even below 1 the price over nav and compared to the historical range is in the lower range. And in addition the Yield is still good 6.36. So this is a potential buy Ascendanchas age Trust. Okay again no, it's too far, too overextended. You see here how far it is from the 50 moving average. So again good one to put in a watch list. But definitely you don't want to buy now because remember that when you want to invest in REITs, at least in the long term for dividends, you're really looking at buying low. Why? Because the lower you buy, the more you can get in terms of yield. So you have to be patient and wait when the price will go down. Even though again Acenda Sage Trust yield is quite Good. This is 25. But as I said before, fundamentals are not everything. If you look at the chart it's pretty clear that the price is overextended. So it's not good. And here, well in terms of price over NAV is not overvalued. So you can, you can just wait and see if, and see if there is an opportunity to buy near the 50 moving average. For example, let's move on to the industrial sector now. So the first one is Maple Tree Industrial. Okay, Mapletree, we have a 5.6 yield that is decent. Let's check here. Okay, so I would say is on the higher range, you see the red triangle here is in the upper half. So the price over NAV is telling us that is a little overvalued. And the chart more or less is telling us the same is near the all time high. So again for this one I will put in the watch list and wait for a small retracement. EC Worth Easy world. Okay is a younger read than the other. And then you can see that at the beginning the candles were kind of broken but now it's getting better. So it means that people are trading it more. I would say yield is quite good. 7.91. Let's check here. EC World. Well, ECWorld if you look at the price of nav is very high. It's really actually close to the all time high. So in terms of fundamentals it's not really the right time to buy and you can see that there was a very, very huge run up and we are close to the all time high at the same time is close to the 50 moving average. So in this case is you Know it's this kind of situation where some indicators are telling you that it may be a good time to buy because you have very good, very good yield and at the same time you are close to the 50 moving average. On the other hand the price over nav is telling you that the REITs is very overextended. So probably what I will do in this case is a mix. What do I mean by that? If I have nothing from the industrial sector and I have some money that I want to allocate there, I can consider to buy if I have something else from the industrial sector already in my portfolio and I don't really need to buy to have a balanced portfolio. I may wait Ascenda street now. Well, Acenda street is a very good read I think in terms of market cap is the largest in Singapore but clearly the price is too high now. So again very good for watch list but especially with the yield 5.35 is not really justified in my opinion to buy now because remember again REITs you don't want to buy at the all time high. REITs you want to buy when ideally you have some kind of support, you are hitting a support or maybe if there is an uptrend you, you hit, you are buying at the deep. That's why I'm saying when the price is retracing to the 50 moving average it could be a good time to buy Capital dc. Capital DC again very, very high. So when it's like that I don't, I don't really need to look at all the other things you see. Sometimes you look at the chart and then it's clear that you will not buy unless the price will drop significantly. Now first REIT is a special case. You see the chart is completely different from the others. If you notice all the other REITs more or less are in uptrend, very overvalued. But first REITs no. So first REIT is a very good REIT in my opinion. It's one of the only two healthcare REITs in Singapore. The other one is the Parkway, they have hospitals in Indonesia. So what happened to this reit? Well, there were some issues with the main sponsor. They had Lippo Karavaci I think it's called and then the price went down quite a lot and then he hit this level of support here and now it seems it's kind of testing the support and going up. So what I will do in this case the fundamentals in my opinion are still good. So at this level however I would wait because here we are in a clear downtrend. I will wait to see if the price can start to go up again. So I would say this is a watch list and if you already have the REITs one or I have the REITs, for example, in my portfolio I'm still holding. Now the reason why I'm still holding is the following. Look at the dividends payout. So when you, when you click here, let me see how we can show you. You see they were paying dividends of 0.0215 and then again, and then again, again, again. So the dividends is very stable. Even though there was this big drop in price, they keep paying the same dividends. And this is what is important to me because I buy REITs to get dividends. Now I want to compare this case to this other case, Lipomol, that is another REIT again with properties in Indonesia. This is a retail one and you see a similar chart. Okay, what is the main difference here? Look at the dividends. They were paying 0.009, 90, then 86, 79, 67, 59, 49, 30. You see? So in this case the big difference is that together with a drop in price, there was a drop in dividend. In this case, if I had shares, I would have sold because one of my main criteria for dividends that you will find in the list of my blog that I will link in the description is that the dividend payout may be stable. Should be stable or increasing. If it's going down, I'm not really interested. So that's why if I had Lippo more, I would have sold already. But first reit I'm still holding. So yeah, and here you can see first read. So of course the price over nav is really at the lowest because there was that huge drop in price. Okay, so that's all with the analysis of REITs. Just to summarize, Fortune, REIT and BHG, I would say no because of the chart. The potential buy I think is capital, retail and maybe easy word and all the others. For one reason or another. I will put them in the watch list. So I hope you enjoyed this video and you find it useful. If you have any question, please just write a comment below the video. We'll be happy to answer and subscribe to the channel. So when I upload new video you will be notified and with that I sign off and see you next time.