Opportunities I'm Watching
24 Feb 2018 21:56
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In March I will have enough to make my next purchase. Luckily prices pulled back enough for some opportunities to surface, these are not huge value plays but at least fairly priced. While there are some nice deals in REITs right now I am going to pass this month. With rising interest rates REITs should be at depressed prices all year so I can get shares at decent prices later so no need to rush.
With REITs on the sidelines I can focus on adding equities of which 5 look like decent values and another 3 are close to my buy price. I already have positions in UPS and PFE so I am leaning towards ABBV, EAT, or LEG.
Comments: 3
page revision: 3, last edited: 24 Feb 2018 22:48
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Close previewHi SDG, looks like you have a well thought out plan for adding new stocks, with a pre-determined buy price. How do you determine this? Do you focus on the yieid or other specific value metrics?
There seems to be a lot of bloggers building up positions in the REITs at the moment - I admire your patience!
Cheers, Frankie
Thanks for replying Frankie :)
I determine a buy price not by value but to what my end goal is and where I need a combination of yield vs. growth to meet a specific income goal 20 years into the future. There is a table on the top left of my page that shows the combo of yield to growth rate that I need. Sometimes I do mildly violate this if I see a need to balance for sector diversification or if I think there is some risk.
Of course sometimes I am a bit greedy and stretch for just that little bit of extra yield like in the case of Hormel which technically fits my yield to growth but the greedy part of me really wants that 2.5% dividend vs the current 2.33%.
As far as REITs, as tempting as they are I strongly believe prices will be depressed for quite some time. I'll probably get crucified for this next statement but right now I think REITs are great income investments and horrible for equity growth if you value port portfolio net worth more than income.
Makes sense, thanks Ken. I don't see why you would be crucified at all - you're simply stating your opinion on REITs, and many people seems to be investing exactly for the income. I love dividends, but I also value longer-term growth over and above the immediate income.