Q&ACategory: Dividend StocksHow actively do you manage your positions in banks and reits?
Jovi Ong asked 4 months ago
Hi It was illuminating how you value the Singapore banks and reits, taking into account the P/B ratio; gap between price and NAV and the historical yields. It seems that there is an opportune time to buy and then sell from the lessons. I am curious if you :- 1) buy and sell out of your banks and reits positions based on these matrix or 2)  buy and hold and collect dividends unless the business fundamentals of the banks or reits have changed drastically.  3.  A combination of both.  If so, what is the % of the holdings that you manage you and out actively? Also, if you actively manage in and out of your positions, typically what is your holding period for the banks and reits? Thank you very much.
1 Answers
Rusmin Ang Staff answered 4 months ago
Hi Jovi A combination of both. For quality REIT that can grow its NAV and DPU consistently, we may not even time in and out as long as the outlook remains bright for them. So we simply buy and hold. For REIT with stagnant growth, we should enter and exit whenever we see their valuation is on the low and high side respectively. For bank, we have been holding it since Covid but may exit when the valuation gets really expensive. So far, they (UOB & OCBC) are still not on the high side and make sense for us to continue holding them. As they are sensitive to interest rate, it is always good to have exposure in both banks and REITs at the same time. If interest rate were to turn suddenly, REITs are going to benefit and vice versa. When we exit, we may do it fully (very high) or partial stake, depending on the situation at that time.