In the recent weeks, shares of property developers, telecoms companies, commodities companies, shipping companies, gaming companies etc have mostly declined in price.
So, in a sea of red, is staying uninvested the way to go? Very probably, many are doing just that. Personally, I am staying invested and mostly in selected S-REITs. In an environment of greater volatility, S-REITs’ unit prices have demonstrated resilience and my portfolio of S-REITs has remained relatively unscathed in the recent market weakness.
Some asked me if it is safe to invest in S-REITs now or add to their long positions. Truthfully, I cannot give any answer in the affirmative. I will ask you to instead consider the more discussed circumstances in which S-REITs could fail.
1. Interest rates suddenly shoot through the roof when the time comes for S-REITs to refinance.
2. Credit drying up, leading to S-REITs being unable to refinance at any price.
3. Tenants defaulting en-masse leading …