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Gold/Mining/Energy : Canadian REITS, Trusts & Dividend Stocks -- Ignore unavailable to you. Want to Upgrade?

To: Cogito Ergo Sum who wrote (1862)	11/9/2001 1:55:18 PM
From: bill	Read Replies (2) \| Respond to of 11633

I asked a question some posts back about the "necessary" relationship of yield to trust price. Got some response but no clear answer. HOWEVER, ask and it shall be given. In the FP todaythere was an article on REITs and at the end it says "Louis Forbes, an analyst at ML,said he downgraded the REITs because they had become too expensive." All of the REITs have fallen below the 20% total return ML demands for any buy recommendation, he notes." So, there it is folks. The "necessary" relationship is 20%. Our buying and selling of REITs have to take into account the upgrade and downgrade of the brokerage houses. If, like Peter, we buy and hold, we can ignore the 20% marker. However, if, like Peter, we also want to buy on dips, the fall below 20% and the shift to a hold recommendation is a signal to start tracking a REIT so as to add it to our portfolio. I've watched a couple of brokerage house recommendations for REITs and the buying and selling does seem directly affected by the recommendations. It may well be that a lot of REITs are held by investors/retirees who allow their broker to trade their accounts.

To: Cogito Ergo Sum who wrote (1862)	11/9/2001 2:42:14 PM
From: stan_hughes	Read Replies (1) \| Respond to of 11633

Kastel et al - Keep your eyes peeled for deflation with those REITS. Commodity prices are still dropping, but real estate is holding the fort principally because of lower interest rates and the lack of suitable alternative investments. However, we're running out of room for rates to fall much further, removing some of the demand push for R/E right at the same time as the onset of the recession starts pushing up vacancy rates and credit problems. If Greenspan successfully spends his way out of this mess, you might be sitting pretty in an inflationary environment a year from now. OTOH if all this monetary stimuli doesn't work and work quickly, R/E may do very poorly as the major global economies keep contracting. Just ask someone who entered the Japanese R/E market 10 years ago how they've been doing for the past decade. Veddy oogly. Not saying that we are Japan, but if you enter the REITs now, you need to be prepared to cope with that possibility.