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

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To: Richard Barron who started this subject10/11/2002 10:08:48 AM
From: Wren  Read Replies (1) of 2561
 
This was posted on the Motley Fool REIT board.

Across the bottom of this 3 year Morgan Stanley REIT Index (RMS) chart is the Relative Strength Index for the RMS. When the RSI drops below 30 it is a signal of weakness. Notice the four times the RSI has dropped below 20 in this three year period.

The first three times (12/99, 9/01, and 7/02) REITs rebounded. Is this an indication that REITs may rebound now?

bigcharts.marketwatch.com

I first learned about the RSI several years ago from an article about a successful investor who watched the RSI of the S&P500 and lightened up by selling 20% when the RSI went above 80, put the cash in money markets, and bought when it went below 20. Like everything else, it does not work every time.
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