OUR MISSION STATEMENT
January 2009
Welcome to REITinvestor.ca.
We believe that REITinvestor.ca is the finest financial website to be found on the web that is devoted to REIT investing. We have spent months assembling the very best team to create a site that provides in-depth fundamental and technical analysis for each of the 23 Real Estate Investment Trusts (REITs) we cover on the Toronto Stock Exchange (TSX).
Information is power. Our goal is to empower our members to be successful REIT investors by providing quality research, valuable opinions and a forum for the exchange of ideas. All these features are included in our Level I Membership. Through REITinvestor.ca, our members will gain an edge on the market, enabling them to spot potential market mispricing, to cut through market noise and to seek out high-return, low-risk opportunities.
We are investors too. Our Level II Membership provides access to the REITinvestor.ca Fund, where you will find our specific long and short trades, our investment thesis and strategy, and our technical entry and exit points for each position. No other website provides this kind of information. All visitors to our home page will see exactly how our REITinvestor.ca Fund is faring, relative to the TSX and XRE (REIT etf) total returns.
Important disclaimer: We do not recommend to any visitor, Level I Member or Level II Member, to buy or sell a stock based solely on the information found on this site. We ask that you consult your professional advisor if you wish to do so. REITinvestor.ca is for information purposes only. We do not know you, your level of understanding of the market or your financial situation. Contrary to what many experts say, the stock market is a very risky place to invest. Please exercise prudence, due diligence and caution before investing.
WHAT WE PROVIDE
We want to become your go-to site for all of your REIT investing needs.
The free area on our home page provides a quick summary of end-of-day quotes and percentage changes for each of the REITs we cover, in addition to top real estate & REIT-related news headlines with links to the complete story. We also provide links to other valuable educational resources for REIT investing. Our fundamental and technical analysis sections explain what important details we are looking for in analyzing REITs, and what thresholds are of concern or benefit when breached.
All our free and paid services are designed to provide information and empowerment to all visitors. Try our 10-day free trial membership access to Level I Membership - we think you will find the information extremely valuable. Even if you do not wish to become a paying REITinvestor.ca Member, you may continue to receive free access to our Market Message for as long as our extended introductory free period lasts.
MARKET MESSAGE
Published several times every week, the Market Message includes our analysis and commentary on recent market activity, with an outlook on signals and targets for the DOW, TSX and various REIT stocks. Market Message will provide insight into short-term targets for the markets, and determine how the market movements may influence REIT stocks. Try REITinvestor.ca Market Message: it’s free for a limited time. Our e-mail alerts will inform you when a new Market Message has been posted.
LEVEL I MEMBERSHIP
RANKING & RATINGS
We hope that you try our free 10-day trial Level I Membership. It’s the soul of REITinvestor.ca, where our in-depth analysis takes apart each REIT’s strengths and weaknesses. To do this, we cut through the market noise and drill down to the fundamentals and technical structure of each stock. We look at each REIT’s asset portfolio; its past, present and future performance; recent acquisitions; lease expiry; and mortgage renewal risk. We are greatly concerned with payout stability, sustainability and growth. Once we have completed our analysis, the REITs are then rated and ranked against each other in our Ranking & Ratings comparative tabulation.
Our rankings are designed to sort out which REITs have the best opportunity to deliver the highest returns, both in terms of payout yield and equity return, relative to the risk they reflect. Each REIT is rated and receives a final ranking from #1 to #5, with #1 being the highest ranking and #5 the lowest. Ultimately, each member can decide which variables should be given greater importance and act accordingly.
ALERTS
Members will receive email alerts whenever a REIT we cover has received a new ranking. From the e-mail alert, the Member can quickly link to REITinvestor.ca, and examine the reason for the ranking change for that REIT. Members can select from any to all 23 stocks we cover to receive the alerts.
FORUM
Our members are encouraged to share comments, concerns, questions and opinions on any of the REITs we cover. No unfounded bashing will be allowed, as we want to encourage the sharing of information. We invite Insiders to defend their position or explain where we are wrong in our assessments. We invite other experts to improve upon our analysis. In short, we encourage direct exchanges that will help all Members understand REIT stocks better.
LEVEL II MEMBERSHIP
REITinvestor.ca is so confident in the quality of its research, that it maintains its own REIT investment portfolio. Level II Members receive exclusive access to the REITinvestor.ca Fund Investment Area. We disclose all our REIT investments, long and short. We discuss what we are looking for before we enter a position, our trade strategy, our exact entry, stops, exits and target zones as we see them. As stated above, we want to make it clear that we are not recommending the purchase or sale of any stock. We are simply disclosing our trades and the reasoning behind them. We know, and we want you to know, that each transaction contains an element of risk, and may result in a partial or complete loss of funds invested. Please speak to your own financial advisor and undertake your own due diligence before acting.
Level II Members will also gain access to a private forum where we answer questions and further discuss exactly what we are looking for before we make a market move. We will also discuss what happened after the market move is made. Our portfolio will maintain a cash position which will be reflected as a percentage of our holdings. Where we feel a REIT is substantially overvalued and we anticipate a likely decline in price, we may take a short position. We use short positions primarily to hedge against other long positions, especially in an overall declining market.
HOW WE GOT HERE
The decision to launch REITinvestor.ca came in late October 2008, after we witnessed a massive 40% decline in a few short weeks for the entire TSX REIT sector. For many individual REITs, that decline continued, with some losing as much as 90% of their value by year’s end.
A decline of this magnitude, in such a short period of time, suggests a complete lack of confidence in the sector by the investing public and institutional investors alike. To put it bluntly, investors have, for the most part, come to a realization that most REIT fund managers, financial advisors and sell-side analysts have a poor understanding of the operational metrics that make up the real estate industry. Few of these so-called experts saw or were prepared for this precipitous drop in values which has left investors wondering if even their remaining equity is safe.
The truth of the matter is that many REITs will not survive to repay their unit holders, while others will provide tremendous returns to those who purchased at or near their stock lows. Those returns will be characterized by growing and perpetual double-digit yields with equity gains in excess of 2 or 3 times the original investment.
WHO WE ARE
As REIT investors ourselves, we have not held any units since 2007 until December 2008 We anticipated the drop in REIT values because, first and foremost, we are real estate people. We recognized a massive disconnect between the traditional principles of private real estate investing and the inability of the market to apply them to public securities. This mispricing is described by some as paying a premium, but we saw it as an overbought market with a high risk of collapse.
REITinvestor.ca is the coming together of true real estate investing principles as they should apply to the liquid market of public securities. Our fundamental analysis does not consider Funds From Operations (FFO) within quarterly reports, but rather considers the asset positioning, management strength and payout stability attributable to the underlying assets cash flow and the financing structure behind the assets.
Our technical analysis team manages timing for entering and exiting positions. The REITinvestor.ca TA team permits us to translate the market sentiment toward individual REITs, the sector as they apply toward the TSX and DOW. Putting it another way, market sentiment can be described “as a rising tide lifting all ships,” and how each ship rises or falls within the market can be revealing.
Thank you for taking the time to review our Mission Statement, and we hope you try a 10-day free Level I Membership.
A.A. Cutler
Founder & President, REITinvestor.ca