Some readers want me to share the entry point for investing REIT. we take the recently purchased MNACT as an example. On 20/9/2020, MNACT suddenly pulled back from SGD0.94 to SGD0.89. It must be noted that the transaction volume was large, see the picture below:
However, the share price did not fall below the support SGD0.89 in mid-August.
From Technical Analysis
I am not an expert in technical analysis. With such a large volume, MNACT can keep the mid-August support, plus the overall trend is still going up. After the stock price stabilizes on the morning of 21/9/2020, I purchased some units at SGD0.905.
From fundamental analysis
All mapletree series REITs will pay dividends in the MAR & SEPT quarter, so it is expected that MNACT will pay dividends in the next 3Q. I expect that the dividend will be at least about 3cent(SGD) per unit. Favourable factors for MNACT include the gradual slowing down of COVID in Hong Kong and the acquisition of Japanese office by MNACT.
I was really good luck, a few days after the purchase, MNACT announced the acquisition of South Korea’s office, and the performance fee will be waived, thereafter the stock price rebounded.
The above is the entry point for me to invest in REITs in general. I will still give priority to fundamentals, plus TA to analyse the trend, buy when the stock price pulls back. I do not necessarily hold MNACT for a long time. If the stock price rises and better investment opportunities emerge, I may liquidate MNACT for cash.
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