General S-REITs Discussion Thread

[Nipponho]

are the heong kong covered calls etf better than US? Didn't know HK also have. Problem is all stock markets everywhere are red hot now, if we enter now, and later burst, the NAV will also go down together with the underlying. Risk reward is not favourable now. Retis is the only ones that has not run yet. I am now examining US covered calls etf, but scared burst because nasdaq has run up so much these few years.

 

[limster]

if we enter now, and later burst

if you don't enter now, and price go up, then you might be like one of those who FOMO and become permabears, everyday wishing that the stock market will crash.

at the end of the day, you have to decide on your plan and investment strategy. If your investment strategy is to wait for a crash, be prepared to accept the possible upsides and downsides.

 

[elvintay07]

I believe the current China Mobile price is good entry level despite the VAT . 6823,hk HK Telecom provides 6.7% with no WHT. As for ETF, Only 3437.hk still give 6.5% yield ..all hkse dividend etf are below 6% as they have run up quite a lot in the last 2 years. I would likely start with covered call etf like 3416 and 3417 which give monthly dividend.

What is covered call etf?

 

[elvintay07]

if you don't enter now, and price go up, then you might be like one of those who FOMO and become permabears, everyday wishing that the stock market will crash.

at the end of the day, you have to decide on your plan and investment strategy. If your investment strategy is to wait for a crash, be prepared to accept the possible upsides and downsides.

Actually I feel time in market is always better than timing the market. If like us already got position in the market, it is not like urgent to enter. But at some stage you have to enter. Lately I went in to buy Netflix, Amazon, Microsoft and Silver Miner in US. In the worst case if bubble pops, then Netflix could potentially be around $50, Amazon $100, Microsoft $220 etc…But by then everyone will be too scare to buy. Now I am actively collecting MIT and some unloved REITs like FCT. MIT once AI boom and interest goes down, then DPU should improve. Actually how much more can reit drop? We can reference to the point where Covid hits and interest is peak. At most drop another 20%?

HK and China has went up quite a bit but still not ridiculously high. For example 3067hk, the valuation is still quite reasonable. Other dividend play as long as can get 5-7% is ok. XJP pattern already see before so I doubt it can be worst. Unless China wants to be like North Korea and Russia, they have to eventually come out to do business.

Many institutions investors are keen to invest in SG but once earnings comes down, then the investors have to go somewhere else to look for better gains. So far SG still in euphoria stage.

 

[yslvlys]

are the heong kong covered calls etf better than US? Didn't know HK also have. Problem is all stock markets everywhere are red hot now, if we enter now, and later burst, the NAV will also go down together with the underlying. Risk reward is not favourable now. Retis is the only ones that has not run yet. I am now examining US covered calls etf, but scared burst because nasdaq has run up so much these few years.

Market red hot now? Not sure if I'm missing something, but markets have been falling for past few weeks..

 

[Nipponho]

Market red hot now? Not sure if I'm missing something, but markets have been falling for past few weeks..

which market are you referring to that is falling? the indexes are on historical highs, STI hit 5000, whole singapore is talking about it. S&P also hit 7k recently and retraced. Only nasdaq dropped, but it is still on hill top. Even Sg reits also did not fall. Or are you refering to softwares? i heard them say softwares fall a lot recently.

 

[homer123]

What is covered call etf?

Go and search in youtube.. it is not something that can be described in a few word

 

[Nipponho]

What is covered call etf?

base on my half pail water knowledge, it is an ETF that write call options on their underlying holdings and sell and earn premiums with the hope that the buyers will not exercise the option. It is to milk more from the underlying while they are sitting there waiting for appreciation or undergoing rollercoaster. This is nutshell. For more details, there are many finfluencers explaining these indepth and even recommendations. Go and find out more, you might find it interesting just like I am. The yields are very good.

 

[Nipponho]

if you don't enter now, and price go up, then you might be like one of those who FOMO and become permabears, everyday wishing that the stock market will crash.

at the end of the day, you have to decide on your plan and investment strategy. If your investment strategy is to wait for a crash, be prepared to accept the possible upsides and downsides.

there is a way to have cake and eat it. I am trying to research on those whose underlying is not s&p or nasdaq or magnificent 7 wholesale. There are some that select dividend counters, so even if s&p burst, these counters are not so affected, at least the underlying dividends plus premiums provide some cushion. NEO also has 2 that has downside protection, but i don't know how it works. Some is energy and infrastruture. I think there is one that is BDC. These should be defensive ones.

 

[limster]

there is a way to have cake and eat it. I am trying to research on those whose underlying is not s&p or nasdaq or magnificent 7 wholesale. There are some that select dividend counters, so even if s&p burst, these counters are not so affected, at least the underlying dividends plus premiums provide some cushion. NEO also has 2 that has downside protection, but i don't know how it works. Some is energy and infrastruture. I think there is one that is BDC. These should be defensive ones.

the simplest way to have cake and eat it is to pick good dividend stocks that pay dividend and have capital gain. I don't go for complex products like covered calls or options.

Managed to beat the S&P500 in 2025 and hopefully can do it again this year. 5.82% in 7 weeks is a good start.

 

[elvintay07]

the simplest way to have cake and eat it is to pick good dividend stocks that pay dividend and have capital gain. I don't go for complex products like covered calls or options.

Managed to beat the S&P500 in 2025 and hopefully can do it again this year. 5.82% in 7 weeks is a good start.

If got dividend + capital gain, then definitely not in SGX. Unless you buy banks in 2021

 

[limster]

If got dividend + capital gain, then definitely not in SGX. Unless you buy banks in 2021

there is a way to have cake and eat it. I am trying to research on those whose underlying is not s&p or nasdaq or magnificent 7 wholesale. There are some that select dividend counters, so even if s&p burst, these counters are not so affected, at least the underlying dividends plus premiums provide some cushion.

yup, nippon-jin was talking about beating S&P using dividend stocks, which is sort of what I am trying to do. I don't think you can beat S&P with SGX stocks, but maybe his research can uncover good counters. Look forward to him sharing his picks.

 

[Nipponho]

yup, nippon-jin was talking about beating S&P using dividend stocks, which is sort of what I am trying to do. I don't think you can beat S&P with SGX stocks, but maybe his research can uncover good counters. Look forward to him sharing his picks.

i came across youtubers mentioned about ETF which selects only dividend counters but could not remember all the names. I can remember one which is called Hamilton DAYMAX 0DTE Covered Call ETFs. This one selects only dividend counters listed in Canada. You might feel uncomfortable when you hear the word covered calls but the concept is not that complicated. The difficult part which is to make money from the calls are already taken care of by the ETF and they charge a certain percentage for this service. The distribution is the sum of dividends issued by the underlying counters + option premiums that the fund manager earn for you. I think the annual distribution is more than 15%. very impressive to me, but not sure if this is enough to satisfy you

I believe there are ETFs with dividends portfolio without covered calls, but the distribution will be lower. If it is less than 10%, it is not worth as some SG reits already can pay you 7-8%.

 

[limster]

i came across youtubers mentioned about ETF which selects only dividend counters but could not remember all the names. I can remember one which is called Hamilton DAYMAX 0DTE Covered Call ETFs. This one selects only dividend counters listed in Canada. You might feel uncomfortable when you hear the word covered calls but the concept is not that complicated. The difficult part which is to make money from the calls are already taken care of by the ETF and they charge a certain percentage for this service. The distribution is the sum of dividends issued by the underlying counters + option premiums that the fund manager earn for you. I think the annual distribution is more than 15%. very impressive to me, but not sure if this is enough to satisfy you

I believe there are ETFs with dividends portfolio without covered calls, but the distribution will be lower. If it is less than 10%, it is not worth as some SG reits already can pay you 7-8%.

thanks, these are interesting ETFs. the Hamilton Daymax ETFs have 0.85% management fee and part of their extra return is through 25% leverage, so probably not for me.

if you are comfortable with leverage then maybe you can borrow money to buy dividend stocks and use the dividends to pay for the interest costs.

 

[Nipponho]

thanks, these are interesting ETFs. the Hamilton Daymax ETFs have 0.85% management fee and part of their extra return is through 25% leverage, so probably not for me.

if you are comfortable with leverage then maybe you can borrow money to buy dividend stocks and use the dividends to pay for the interest costs.

to me, management fee is not important at all, the distributions more than justify the 0.85% multi-fold. There are also others with same strategy without leverage distributions about 12%. This one is 15% with leverage,

The simple strategy you describe, just buy dividend stocks, has nothing to cushion if the stock price plunge. These ETFs has ongoing earnings from selling calls which can subsidise the paper loss caused by stock price drop.

leverage, used by laymen like us, of course can be disastrous, but if used by skilful managers, it can enhance the returns, Many hedge funds are on leverage and they are making a lot of money for the banks.

 

[elvintay07]

thanks, these are interesting ETFs. the Hamilton Daymax ETFs have 0.85% management fee and part of their extra return is through 25% leverage, so probably not for me.

if you are comfortable with leverage then maybe you can borrow money to buy dividend stocks and use the dividends to pay for the interest costs.

Where is this Hamilton Daymax ETFs listed? Is it in Canada?

 

[sky1978]

to me, management fee is not important at all, the distributions more than justify the 0.85% multi-fold. There are also others with same strategy without leverage distributions about 12%. This one is 15% with leverage,

The simple strategy you describe, just buy dividend stocks, has nothing to cushion if the stock price plunge. These ETFs has ongoing earnings from selling calls which can subsidise the paper loss caused by stock price drop.

leverage, used by laymen like us, of course can be disastrous, but if used by skilful managers, it can enhance the returns, Many hedge funds are on leverage and they are making a lot of money for the banks.

They bought into another dividend ETFs which yield less than 3%. If they are going to provide a distribution in excess of 15% (from income), that will mean the income from writing option will have to be greater than 12%.

Did you check whether the distribution was 100% from income or partly from capital?

When I looked at their tax disclosure, it seems like a huge chunk of distributions came from return of capital, which is tax-exempt. So the question is, how much profit did they actually make?
https://hamiltonetfs.com/tax-information/

 

[Nipponho]

They bought into another dividend ETFs which yield less than 3%. If they are going to provide a distribution in excess of 15% (from income), that will mean the income from writing option will have to be greater than 12%.

Did you check whether the distribution was 100% from income or partly from capital?

When I looked at their tax disclosure, it seems like a huge chunk of distributions came from return of capital, which is tax-exempt. So the question is, how much profit did they actually make?
https://hamiltonetfs.com/tax-information/

Thanks for the caution. Give me some time to check on the warnings that you provided. Based on my understanding, the distributions are not from the capital because if this is true, the NAV will suffer, but the NAV does not seem to drop. And also if this is true, the youtubers will be complaining. But this ETF is one of the group of ETFs being highlighted for no NAV erosion.

 

[Nipponho]

When I looked at their tax disclosure, it seems like a huge chunk of distributions came from return of capital, which is tax-exempt. So the question is, how much profit did they actually make?
https://hamiltonetfs.com/tax-information/

Could you also help to check whether your comprehension is correct? Base on my half pail understanding, there is a 60/40 tax treatment whereby 60% is regarded as return on capital and is not taxed until the person sell and then become subject to capital gains tax. The other 40% is taxed like normal taxable income. Let me know if my understanding is flawed

Edit : I just read the link you provided. No where did they say the dividends come from the capital. In fact the section on "Return Of Capital" explained it well. If I interpret it correctly, "Return of Capital" means "earnings arising from the capital you had deployed earlier, ie yields". It should not mean "returning back to you the capital you have deployed earlier, ie returning back your own money".

 

[Nipponho]

Where is this Hamilton Daymax ETFs listed? Is it in Canada?

should be la. I also not very well informed because i am not financial advisor earning commision by promoting this ETF. It's just that this member Limster mention he is interested about ang mo dividend stocks, so i tell him about this ETF. There are also several others. I myself have not bought yet because i am overwhelmed with a plethora of information and have difficulty digesting.