2024 Market Sentiment & Positioning

[d5dude]

BoJ is slowly removing YCC but market perceive it as weak and ineffective.

Eventually the politicians will be roasted with fire when the JPY weakens enough.

Yea I think Kishida is done, but Japan has a habit of firing their PMs after a very short stint, so this isnt new. I think the BOJ is just trapped, the Japanese gov can never fund itself if they allow rates to soar, not with debt/gdp at 270% anyway.

 

[stanlawj]

Yea I think Kishida is done, but Japan has a habit of firing their PMs after a very short stint, so this isnt new. I think the BOJ is just trapped, the Japanese gov can never fund itself if they allow rates to soar, not with debt/gdp at 270% anyway.

Haha... I think you are absolutely right... BoJ has no idea how to exit YCC safely without blowing up something important in Japan.

 

[limster]

My portfolio is barely afloat after hitting 10%++ at one point. My original target was to get at least 10% for 2023 so hopefully there will be a 5% rally...

However, the price correction means I am not done buying for the year so I have been adding VWRD, VUSD, and various ETFs. Whether this is trying to catch a falling knife or catching a year-end rally, I'll only know at the end of the year

 

[DevilPlate]

The problem is the yield is not in anyway guaranteed compared to cash or bonds. Sreits appear to be highly levered and most of the increase in IR have not bled thru to their P&L yet, DPU will get hit if rates remain elevated for just another 2-3 years because they need to rollover their debts.

I'd never treat any sort of equity investment as fixed income, I think reits have the risk profile of high yield (junk) corporate bonds so they are more like equities than fixed income.

Reits definitely belong to equities category.

 

[boroangel]

Let say u have 1M cash now.
Whack reits etf at 5.5-6% yield now or hold cash at 3.5-4% yield?

10years later, will reits outperform cash?

100 % in SGD and USD T-bills for now.

Wait till the S REITs thread disappears into the 4th or 5th page of Stock forum and no one wants to talk about s REITs, wait till the financial Utubers stop making videos about S-REITs, I think that would be the time to go big back into S REITs.

I think Right now probably still too much money on sidelines looking to capitalize on recent downturn in sreits?

Never bought any S REITs before so am waiting for disinterest to really set in across social media platforms before I start putting money in, that’s just my view.

 

[jayou8]

Wework looks like gonna to file for bankruptcy. First thing that came to my mind is surely there will be some SREIT will struggle to fund their debt?

 

[revhappy]

Most of the YouTubers making videos on REITs have not seen normal interest rates. Including Josh Tan, who looked a bit senior to me. But even he is 39. So I think he also started his investing in QE era.

So just like boomers were proved too conservative during QE era, it is possible that the millennials maybe proved too much of risk takers in this post covid era.

But there is no way to tell if interest rates will fall or rise going forward.

 

[stanlawj]

Most of the YouTubers making videos on REITs have not seen normal interest rates. Including Josh Tan, who looked a bit senior to me. But even he is 39. So I think he also started his investing in QE era.

So just like boomers were proved too conservative during QE era, it is possible that the millennials maybe proved too much of risk takers in this post covid era.

But there is no way to tell if interest rates will fall or rise going forward.

In 2024: UST 10yr yield will go above 5%. JGB10 yr yield will go above 1%.

Reason: US economy will still be in positive but declining GDP, sustained by govt spending (govt jobs, govt contracts, govt subsidies for Democrats vision of green future) which in turns maintain the state of UST oversupply (whether short end or long end). So, UST yield curve will continue to uninvert (i.e. normalise) with short duration rates pinned at 5.5% by good old Jay Powell. (Ouch!!)

BoJ will slowly be forced to exit YCC (by end of 2024) after USDJPY causes painful inflation faster than wage growth (both about the same now). Just watch the USDJPY and JGB10yr yield, both still rising post BoJ monetary policy meeting.

For those reasons, the future looks bleak for the rates that REITS will undertake in their 2024 loan refinancing cycle (refinancing for loans with 2025 maturities).

None of the REITS manager breathe a single word about this potential refinancing strains. Looks like they are macro-agnostic and continue to paint a rosy world in the presentation.

 

[limster]

None of the REITS manager breathe a single word about this potential refinancing strains. Looks like they are macro-agnostic and continue to paint a rosy world in the presentation.

It will be interesting to see whether REITs are planning rights issue to reduce gearing. The Capitaland Ascott one didn't go to well, with all the private placement buyers all going underwater even before the rights issue was completed. Fortunately, they got strong sponsor that subscribed to their entitlement.

I would be ok to average down capitaland REITs for example, but I wouldn't touch those without a strong sponsor.

 

[stanlawj]

It will be interesting to see whether REITs are planning rights issue to reduce gearing. The Capitaland Ascott one didn't go to well, with all the private placement buyers all going underwater even before the rights issue was completed. Fortunately, they got strong sponsor that subscribed to their entitlement.

I would be ok to average down capitaland REITs for example, but I wouldn't touch those without a strong sponsor.

FCT is still my only choice pick (still waiting).

 

[sohguanh]

FCT is still my only choice pick (still waiting).

The XD strategy does not always work. This week should have a few REIT XD but not all will drop after XD they have strong supporters.

 

[churnmaster]

100 % in SGD and USD T-bills for now.

Wait till the S REITs thread disappears into the 4th or 5th page of Stock forum and no one wants to talk about s REITs, wait till the financial Utubers stop making videos about S-REITs, I think that would be the time to go big back into S REITs.

I think Right now probably still too much money on sidelines looking to capitalize on recent downturn in sreits?

Never bought any S REITs before so am waiting for disinterest to really set in across social media platforms before I start putting money in, that’s just my view.

Last year, you had PBR in your portfolio. . Right? Just wanted to check how much is the WHT for Brazilian ADRs.

 

[churnmaster]

It will be interesting to see whether REITs are planning rights issue to reduce gearing. The Capitaland Ascott one didn't go to well, with all the private placement buyers all going underwater even before the rights issue was completed. Fortunately, they got strong sponsor that subscribed to their entitlement.

I would be ok to average down capitaland REITs for example, but I wouldn't touch those without a strong sponsor.

That’s correct be with the big players in the industry . . Ascendas is already up 20c I.e. 8% from its recent bottom.

 

[aurvandil]

But there is no way to tell if interest rates will fall or rise going forward.

Unless you have superantural powers, there is no way to predict what will happen. You can however read market expectations based on the shape of the yield curve. Instead of Higher for Longer, the yield curve is saying the market expects Higher Forever.

Forever here of course is defined as until the next crisis hits and the FED needs to bring out the QE bazooka. As of now, there are no signs of any sort of stress in the commonly watched financial stress indicators. The recent global banking scare shows the amount of improvement Central Banks have made to their financial resuscitation methodology. If there is a crisis that needs the bazooka, it will need to be more extreme than the crazy things that happened in the past 2 years.

 

[boroangel]

Last year, you had PBR in your portfolio. . Right? Just wanted to check how much is the WHT for Brazilian ADRs.

I sold it last year if I remember, was too early in selling and missed 1 year of dividends

I had both PBR and PBR.A. Dont quite remember on the WHT, I think it might have been 0 or 10%. Really cannot remember. I will see if I can check back the records.

 

[stanlawj]

I sold it last year if I remember, was too early in selling and missed 1 year of dividends

I had both PBR and PBR.A. Dont quite remember on the WHT, I think it might have been 0 or 10%. Really cannot remember. I will see if I can check back the records.

I think selling too early is something to be appreciated.
It is good as long as your portfolio or account reaches a new all time high. There is always another chance to make big bucks later. I'm beginning to learn to appreciate this.

The alternative is not sell, and eventually get caught late into a downtrend, and portfolio entering a big drawdown. This is what happens when you misjudge a small correction. It can turn into a big nasty trend reversal.

 

[andyhtc]

Unless you have superantural powers, there is no way to predict what will happen. You can however read market expectations based on the shape of the yield curve. Instead of Higher for Longer, the yield curve is saying the market expects Higher Forever.

Forever here of course is defined as until the next crisis hits and the FED needs to bring out the QE bazooka. As of now, there are no signs of any sort of stress in the commonly watched financial stress indicators. The recent global banking scare shows the amount of improvement Central Banks have made to their financial resuscitation methodology. If there is a crisis that needs the bazooka, it will need to be more extreme than the crazy things that happened in the past 2 years.

The interest rates for housing loans have dropped to around 3% now from 4% last year in Singapore.

I suppose Singapore is still unique in that interest rates have dropped.

My gut feeling is Fed will lower the interest rate in the 2nd half of 2024.

 

[rider83]

US stock market Year-End Rally starts yesterday, dont miss the boat!!!!

 

[limster]

Meet Kelvin, a personal finance YouTuber. In 2007, he moved to Singapore from Malaysia, and just two years ago, he became a Singaporean citizen. Kelvin shared with me what it feels like to renounce Malaysian citizenship, how he left his corporate job to start earning 20K a month as a YouTuber, and his plans for early retirement. Enjoy!

Those who quit Corporate Job to do youtube ... its more like changing job for higher salary.

 

[zeroX26]

The interest rates for housing loans have dropped to around 3% now from 4% last year in Singapore.

I suppose Singapore is still unique in that interest rates have dropped.

My gut feeling is Fed will lower the interest rate in the 2nd half of 2024.

Who's offering 3%? Im still being quoted 3.25-3.3% for mortgage leh.