REITS - Buying 1 - 2 weeks before going ex-dividend Message Board

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Strategies & Market Trends : REITS - Buying 1 - 2 weeks before going ex-dividend

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To: gregor who wrote (2506)	3/9/2004 10:49:32 PM
From: Richard Barron	of 2561

Jim, The rubber band is getting stretched and will continue until momentum changes. I believe the long term effect will be determined whether interest rates climb in anticipation of inflation, or as a result of inflation. The first will keep REITs overpriced for an extra 5 years if the fed effectively snuffs out inflation. The 2nd scenario will mean that REITs will grow into their prices in a somewhat orderly fashion. Either way, REITs are trading above NAV's by a lot. There are too many other factors for me to predict what will happen to REIT prices. Real Estate as a class has gained respect and will likely trade at higher multiples for some time. Supply hasn't been outrageous, but if developers sniff a stronger market before interest rates spike, watch out for a rush of supply, which would hurt rent prices. Apartments and high tech office space (due to outsourcing) may find the demand is growing slower than previously due to structural changes. Momentum players and hedge funds may play with REITs whenever the general market stalls, creating bigger swings. REITs have been issuing tons of stock and preferreds lately. Normally this is near a top, but I have seen some reports of large insider buying, so... who knows? On the other hand, the ^RMS channel shows no sign of breaking down. When it does, I expect a 20% correction minimum over 2-6 months. That said, I am rarely ever right these days. The QQQ (Nasdaq 100) is showing tiring signs as it approaches it's 200 day moving average. a 2-3% further pullback will likely produce a technical bounce, and then we will see if this market is ready to continue the upswing or the 2000-2002 slide. Richard p.s. I dropped my subscription to the TMF boards. It took me 25 minutes a day to read, and I didn't find enough content to justify that much time. finance.yahoo.com

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