CapitaComm Trust investing idea

quote from our value investor : @Jeremyowtaip

For fundamentally good stocks, the more they suffer a fall in price due to worrying macroeconomic environment or temporary challenges specific to the underlying business, the more attractive it is. I have went through so many rounds of these same situations. And the way to operate is just to buy when the price keeps falling lower and lower. The crux is to spread out one's funds into several batches and buy only when price falls by at least 10% to 15% each time from the previous bought in price. No need to side guess where the price is heading next day, next week or next month. As long as price drops to the next buy in level, just buy one more batch. And keep doing this. This will lower one's average cost in the shares while building up one's position at the same time in the same shares of the fundamentally good business.

And if one has holding power and time, the fundamentally good stock will almost 100% of the time recover and make profits for the investor. I have operated in this way and has never made any losses before in any of the stocks I have first picked and entered over the past decade of my investing journey. As such, I can say it is 100% effective as I have never made any losses on any stocks I picked operating in this manner backtested with a decade of investing experience in several stocks I have operated like this. In fact, some of the stocks in my existing portfolio were bought and held over the past decade without selling a single share but just keep buying and accumulating whenever prices fall. And the share price has already gained in terms of good paper profits. One example is CapitaCommercial Trust which I am currently up by about 83% above my average holding price and having a dividend yield on cost of about 10%. I practise a buy-and-hold method and has not sold any single units of it over the past decade.

This buy-and-hold method works for a non-leveraged portfolio because the investor has holding power and does not run into any liquidity problem holding through the fall in share price of the vested stocks. However, for a leveraged portfolio, the investor must exercise careful judgment when using such operation method. It is not that this method of buying and building positions on falling prices cannot work in a leveraged portfolio. But, the investor working on applying leverage must realise that there is always a risk of margin call and he is not able to predict how low his leveraged portfolio value will fall especially in a bear market to trigger margin calls and force closing of his positions.

Therefore, buy-and-hold can work for fundamentally good stocks to make reasonable to good returns for the investor who can accumulate large positions while lowering his average cost in the good stocks capitalising on the occasional opportunities of falling prices. There should not be any fear of falling prices if the buy-and-hold investor is not using leverage since he can continue to buy and hold through falling prices for future recovery in share prices.

However, if using leverage, the investor must protect his leveraged portfolio from extreme price volatility swings which may hit margin calls and force selling. A buy-and-hold strategy can still work for a leveraged portfolio. But the user of leverage must be careful not to over leverage to operate always with a sufficient buffer to protect against margin calls and force closing of positions due to potential of extreme price volatilities especially in a falling bear market.

Trailing EPS of 14.5 cents.
Net Asset Value : $1.838.
DPU of 8.4 cents.
Yield of 4.74%
P/B 0.963.
Gearing 32.3%
Current price of $1.77.

DPu seems to be dropping..

Yield at current level of 4.74% seems to be a little bit low for Reits counter..
I would patiently wait for it to go back to min 5.5% that is about $1.525 price level.

Not a call to buy or sell.
Pls dyodd.



CapitaLand Commercial Trust is Singapore’s first and largest commercial REIT with a market capitalisation of approximately S$6.6 billion. CCT aims to own and invest in real estate and real estate-related assets which are income producing and predominantly used, for commercial purposes. CCT’s deposited property is approximately S$11.6 billion as at 30 June 2018 comprising a portfolio of 10 prime commercial properties in Singapore and one property in Frankfurt, Germany acquired on 18 June 2018. The properties in Singapore are Capital Tower, CapitaGreen, Asia Square Tower 2, Six Battery Road, Raffles City (60.0% interest through RCS Trust), One George Street (50% interest through OGS LLP), HSBC Building, Twenty Anson, Bugis Village and CapitaSpring (45% interest through Glory Office Trust and Glory SR Trust), an upcoming 51-storey integrated development in Raffles Place. The property in the Banking District of Frankfurt, Germany is Gallileo (94.9% interest). CCT has been a constituent of FTSE4Good Index Series (FTSE4Good), a series of benchmark and tradable indices derived from the globally recognised FTSE Global Equity Index Series. FTSE4Good is designed to track the performance of companies meeting international corporate responsibility standards and forms the basis for over 70 different funds and investment products. CCT is also a constituent of other widely recognised benchmark indices such as MSCI, the SGX Sustainability Index and FTSE Straits Times Index. CCT is managed by an external manager, CapitaLand Commercial Trust Management Limited, which is an indirect wholly owned subsidiary of CapitaLand Limited, one of Asia’s largest real estate companies headquartered and listed in Singapore.