2023 Jan Portfolio Update

 



January portfolio update. Currently @ 1.1m. Notch up 1% from the previous month. It's heartening to see the Chinese stocks slowly recovering, turning red to green. However, at the same time, my US related REITs are pretty affected by the Manulife REIT devaluation saga. Though it seems like some green shoots are starting to appear. Fingers crossed, hopefully things will look even better in 6 months time!

Money didnt go missing in Oct and Nov 2022, it's simply because I fail to keep track during these two months. Steep decline from Aug 2022 to Sept 2022 
was mainly due to retention of around 100k sales proceeds when I adjusted my portfolio. 

Comments

  1. Hi Happy RI, what's your thoughts on United Hampshire US REIT? I recalled you also held a stake in them. Its price performance has been a disaster over the last 12mths- makes one wonder whether there are undisclosed surprises from their management.

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    1. Hi there, indeed, I do have a chunk of United Hampshire, I was averaging down along the way. It makes up around 10% of my portfolio. I dont think there's any major skeletons in the closet as you can see that all the US based REITs are moving in the same direction.

      1. The macro environment for US REITs was generally very negative from September 2022 onwards when the narrative on interest rate/inflation starts to turn extremely negative and Fed rate went above 3%. Hampshire price was stable hovering around 60cents prior to that.

      2. There seems to be a rumour going around saying the dividends are subjected to WHT, even though the REITs have clarified on it, but I guessed they can do better in sharing the information. A few readers sent me an email on this as well. Even so, some people are still skeptical about the WHT waiver saying "well, things can change, biden may need more money to support the ukraine war and hence start to charge WHT". Nothing I can say about that, I dont have a crystal ball.

      3. The constant negative news about recession/interest rates may have spooked people as well, if people cut down on discretionary spending, shopping centres REITs will be impacted. However, united hampshire deals mostly with supermarkets. Surely people will still spend on food and groceries right?

      4. The Manulife REIT devaluation saga might have added to the negativity as well. That may put people off US REITs as well. Again, united hampshire doesnt deal with office space. Perhaps people do not differentiate between REITs of different industries.

      I will still hold on to it, but that's just me. What are your thoughts?

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    2. Hi Mate, thanks for sharing your thoughts and insights....appreciate!

      Personally for me, as long as no major hidden surprises like potential fraud or multiple major tenant bankruptcy, think I will also be holding on to all my accumulated UHREIT units too. Just that I can't help being worried whether there are hidden bad news since the price kept dropping from 60 cents time.

      One point of concern is that I wonder how UHREIT management plan to do further yield accretive M&A to grow their property portfolio in view of the current high distribution yield (due to the plunge in prices) and expensive cost of debt financing.

      Nevertheless, I am looking forward to the upcoming year end results release on 22 February 2023 and the amount of fund available for distribution. Hopefully, the hard cash on hand will boost investors' confidence.

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    3. I think it is perfectly normal to be worried because we seem to be going against the general market trend. Another point to note is that the manager of UHREIT is a JV between UOB Global Capital and Hampshire companies, that gave me a little more confidence of the capability of the management.

      How I feel now for the US REITs is exactly the same how I felt during the 2nd half of 2022 for Alibaba. I think I was the odd 1 out who was buying Alibaba as it kept dipping. Some people commented that I was trying to catch on to a falling knife. I can finally see some light at the end of the tunnel. I certainly hope it is not an oncoming train though! Haha.

      Frankly speaking, i wouldnt be too worried about the lack of acquisition activities at this moment of time. They concluded an acquisition mid of 2022. I prefer them to be more defensive in high interest environment. Moreover their yield is attractive enough for me to continue to hold on even if the share price recovers back to IPO price of 80 cents. (my average is around 63 cents, ill be very happy if it goes back to 80 cents haha!)

      Yes, I am also waiting for the next reporting. That will certainly give more clarity on the health of the company.

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  2. Hi the only "ISSUE" with UH is the long WALE in this rising interest rate environment.

    It is 8% of my portfolio and also the largest position.

    I agree that the price is attractive and there is unlikely to be much unknown unknown risk to weigh on this.

    I've rotated some KORE into this over last 2 months seeing that this is likely going to be much more defensive in any recessionary environment.

    Manulife and prime still stuck in the mud, I don't have the guys to add to these

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    1. I dont have Manulife but I do have Prime and KORE (small amount). Prime is 15% of my portfolio though. Hamp is 10%. Let's see if this is just the usual price appreciation leading up to financial reporting day, and hopefully the price doesnt go all the way down again after Ex D. I am quietly optimistic.

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