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CBRE Clarion Global Real Estate Message Board

  • jynhui1 jynhui1 Dec 14, 2007 11:59 AM Flag


    I have been in this for two years, buying from $14 to $20, so kind of break even with all those dividends.

    Just doubled my position with purchases average $16.5. With exdiv 12/19 for $1.82, it will go back to $15, and at that low PE and yield of 10%, it will creep back up. Its relatively low gear, NAV discount, and overseas exposure should make this a steady earning winner.

    I am loading up so that its dividend will be enough for me to retire on their monthly check.

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    • There are other dividend plays. ERF, PWE, and HTE. All of these have good PE except HTE, with great dividend. IGR is also good but there is extreme over-reactions and misunderstanding between commercial vs residential securities.

      What do you think Jin of ERF/PWE/HTE?


      • 1 Reply to oncologyrpci_2001
      • I own some of all of those. I also have some PVX and PGH. There are political/tax issues occasionaly with these. But I think Canadian tax overhead and uncertainty beats what the mid east and parts of south america have going in terms of overhead and uncertainty.

        There are also US ones. But the US ones are normaly royaltes on a fixed set of oil/gas fields such that when those fields run out, the fund disolves. US ones include BPT, PBT, SBR, and SJT (SJT is almost entirely natural gas though).

        I've owned a mixture of these from when oil was 40 to 50 and have added to them as it climbed to 90, but it doesn't seem like the stocks have gone up as much as the price of oil has so even if the price comes down some, maybe the stocks won't go down as badly.

        Until recently I was driving 40 miles per day and owning these guys more than paid for my gas.

        I even joke that you could be a better environmentalist by investing the same amount of money you would pay for a hybrid in these stocks, then driving for free, and using the remainder of the dividends to buy carbon credits. Ford had a thing where you could pay a carbon fee and get some kind of sticker said you were carbon neutral. With investing the price of a prius in these would probably pay for gas and then buy multiple of those stickers and then you could look down on prius owners as environmental retards.

    • With interest rates low and going lower,real estate especially commercial should be fine going forword.Now is the time to start looking for these type of funds,they already have fallen in response to the weak real estate market and now should level off and start rising,as the future for real estate going forword will be brighter.Market always looks ahead.

    • Thanks. That's pretty good advice. Have done that already and at slight profit.

      Agree that we never know the true amount of leveraging in this multiple layers of leveraging. The only thing to gauge the situation is dividend, which unfortunately, I have no way to tell if it would be decreased. If not, then leveraging on my part would be very profitable.

      True that real estate, particularly the commercial sector, is going to get worse in the US. But two important components of IGR, particularly the HK and the Australian holdings, seem to still have uptrend. HK real estate is anticipated to have a runup this year, given limited supply this year. For Australia and other countries, at least we have a currency play here.


    • I believe IGR uses leveradge too.

      So this means you would borrow money to buy a fund that borrows money to buy companies that borrow money to buy buildings.

      I love buildings. And I don't mind being short the paper money. But, since leveradge is added at every other step of the way, I would not add my own personal leverage on top of that.

      No mater how great the asset, perception is a big part of price and that makes the future performance based on more than just the objective mertis (which are hard enough to predict into the future).

      I love IGR, REITs, and REIT CEFs, and I think it's fine that they employ leverage, but that's where I draw the line.

      Basicly part of the point of buying a CEF that uses leverage is that the CEF already does what you describe. And if you can get a good deal on margin, I bet ING can get a better one.

      Another comment would be why not consider a mixture of some other CEFs in addition. RWF and RPF are my other favorites. RWF is global like IGR and RPF is domestic. ING has a domestic one too which I believe is IIR.

    • jynhui1:

      Never mind. I saw your calculation in another thread. Thanks.

    • Yes, they do. I have been doing that elsewhere at 8%, but Fidelity to my surprise, drops their rate to 5% if you have a debit of half million. Of course, you need to come up with a 1/2 million first before you can borrow another half. Kind of like the 20/80 down/borrow rule for mortgages.

      Because of 50/50 nature of margin loan, no principal payment is required. To Fidelity, this is more secure than mortgages. It is less leveraging. They give you margin calls/force sale in lieu of foreclosures.

      Honestly, 5% is reasonable. Most brokerages make money through margin loans, not that measly commission.

    • Good strategy. I don't know why in the world anyone would be selling going into next week's ex-date? We have some pretty stupid people invested in this market right now. You know. The ones who sell at a loss (for tax purposes) right before collecting a dividend. Idiots.

      • 2 Replies to oilnewby
      • Thanks oil, I thought I was crazy. Why this think is sinking like a lead ball in water when the pay date didnt even come up yet is beyond me. The only thing that rationally makes sense is that the 3 biggest institutional holders of this are wells fargo, bank of maerica and citibank. Maybe they have instructions to dump all reit holdings . Period. It wouldnt make sense, but I have never seen a solid co like this ever do anything this close to div. date. Unless, God forbid........nahhhhh, a co. the size of ING couldnt default could it? Maybe we should look at their other funds and see whats up. I have my mothers retirement money in the POS.

      • The payable date is 12/31/07. With half day trading and most of the time delays by the brokerage, I am buying now to collect the humongous dividend and capital gain, and not paying up tax due until late 2008.

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