Like Tree30Likes

Will the market tank tomorrow?

Reply
Page 3 of 6 FirstFirst 1 2 3 4 5 6 LastLast
  1. #21

    Join Date
    Aug 2013
    Location
    The World
    Posts
    1,129
    Original Post Deleted
    You are the king of REITs after all - so which markets do they mostly own assets in if not HK?

  2. #22

    Join Date
    Oct 2018
    Posts
    263

    SPG and Link are really two very different REITs, operating in two very different markets.

    SPG owns large malls in the US. Link owns predominantly small malls, wetmarkets, and car parks in HK, plus a couple of large malls in Australia and China.

    So, the sector they are operating in is different, as is the country. In the US there is a mall apocalypse, and for this reason SPG has been dropping a lot over the last years (-76% since 2016). According to most analysts (e.g. Brad Thomas) the drop in the price of SPG isn't really justified, because they have the best malls in the best locations. The malls that are closing are mainly in the suburbs, in the middle of nowhere, where people need to drive 30 minutes. This is not the case for SPG's malls. SPG also makes a lot of profits and has huge reserves to invest in modernise their malls. The argument is that one way or another, malls located in good places will always exist, as long as they reinvent themselves to satisfy shifting demand (e.g. some shops can even be transformed into offices). The payout ratio of SPG is only 82%.

    As you know, most of the business of Link is located in Hong Kong, and HK has a few differences with the US. Mainly: 1) The weather is rubbish, so when people go out, they spend their weekends in shopping centres (at least during the summer). 2) Shopping centres are located above MTR stations and bus interchanges, and below people's houses. Most people go to work using public transportation, so they go through the shopping centres owned by Link (and of course all the other Reits) daily. This means constant traffic, and sales. Of course I can see a change in the shops in HK malls. For example, the shops selling gold jewellery and beauty products to Chinese tourists will gradually disappear (I don't know why they are still open in the shopping centre near my house), but they will be replaced by other shops selling stuff for HK people. Though the rent will be lower, I don't see many vacancies in HK shopping centres (there are some in a shopping centre near my house, but it should be filled easily if the owners agree to cut the rent). Since Link owns predominantly shopping centres for HK working class people, I don't see much of a change in the number of shoppers (and profits) in the future. I can see a drop in Australian and Chinese shopping centres (and income from car parks). Perhaps someone can tell us how much of the total income to Reit comes from these sources?

    I believe both SPG and Link are rather safe investments, at present day prices, for dividend investors. Although SPG might drop more if the virus doesn't go away/there isn't a vaccine and malls are closed again, and Link will drop more if the PLA sends its tanks.

    Full disclosure, I own both SPG and Link.

    orel100x likes this.

  3. #23

    Join Date
    May 2006
    Location
    Pampanga, Philippines
    Posts
    21,715

    So repeating the original question, will the market tank tomorrow?


  4. #24

    Join Date
    Dec 2002
    Location
    ???
    Posts
    32,075
    Quote Originally Posted by hullexile:
    So repeating the original question, will the market tank tomorrow?
    I do suspect it will end lower than Friday... Tank, I have no idea.

  5. #25

    Join Date
    Dec 2002
    Location
    ???
    Posts
    32,075

    I don't think we are in for a drama free week..

    Let's see...

    GentleGeorge likes this.

  6. #26

    Join Date
    Feb 2019
    Posts
    579

    Get long vol


  7. #27

    Join Date
    Nov 2005
    Location
    Cramped island
    Posts
    4,114

    longing vol at this time is costly and usually doesn't pay well... not only is the implied way above the roof, the bid-ask is also painful... so generally you don't really benefit much from it as time decays.


  8. #28

    Join Date
    Oct 2006
    Location
    Hong Kong
    Posts
    13,961

    The real question is, when will the tanks roll in, and when they do, how that will affect the HSI's long term position.

    At the moment I just see what is going on at the moment as short term volatility.

    Coolboy likes this.

  9. #29

    Join Date
    Jun 2019
    Posts
    3,190

    My post on here got deleted for no reason. So I will ask again, is this a short-term correct/plunge vs long-term trend of decline? If we are talking about decline as some posters on here are suggesting, just how far and low will HSI go I wonder...


  10. #30

    Join Date
    Dec 2002
    Location
    ???
    Posts
    32,075

    Do any of you guys have access to Southbound buy/sell trading stats for today?


Reply
Page 3 of 6 FirstFirst 1 2 3 4 5 6 LastLast