Martyn Lockhart @Martyn87: "Strategy Update I thought I would..."

United Kingdom

Edited

Strategy Update I thought I would give an update on my investing strategy for the next few months ahead. I have been watching the economy closely and surprisingly the US jobs numbers have started to become very weak. The US markets appear to be in a bubble of their own whilst the average person loses their job or has to work multiple jobs just to survive. At a high level I am expecting interest rates to start coming down again, starting with the rate cutting cycle to resume again tomorrow in the US. It looks like there are now three 25 basis point cuts priced in there for the remainder of the year. This is important because as the US brings rates down it should mean interest rates will come down in other markets too. I have positioned my portfolio to benefit from this trend by buying UK REITS. I am positioned in Grainger PLC which owns over 10,000 homes to rent, predominantly in London and Derwent London PLC. Derwent own multiple office developments in the West End of London which is some of the most desirable real estate in the world. As per the WSJ link I have posted below, there is such a big shortage of prime office space in London that now rents are considerably higher there than in New York for example. I am taking advantage of this by buying into Derwent at 1611p. The NAV of the portfolio ie the market value is just under 3200p a share so there is huge upside to come in this stock. It’s the same story with Grainger. Having bought in at 191p the NAV of all the properties is just over 300p a share. The point being my portfolio is positioned for large upside with the downside fairly limited due to the asset back NAVs of the properties each company owns. In the meantime my portfolio also pays a 5% yield. In summary as interest rates also come down that too should help the share prices rise back till closer to their NAVs. $UK100 $SPX500 $NSDQ100 $GER40 $TLT (iShares 20+ Year Treasury Bond ETF ) www.wsj.com/real-estate/commercial/apple-citadel-and-other-u-s-firms-are-fueling-an-office-boom-in-london-539560b3?mod=hp_listb_pos1

5 Mentioned

UK100

SPX500

NSDQ100

GER40

TLT

iShares 20+ Year Treasury Bond ETF

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