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Sunday, 11 March 2018

The Mother of all Sell-offs for Risk-averse of REITS, Trusts and Defensive Dividend Stocks: 11 March 2018, Sunday, 2.00pm Singapore Time

The Mother of all Sell-offs for Risk-averse Assets of REITS, Trusts and Defensive Dividend Stocks:
11 March 2018, Sunday, 2.00pm Singapore Time
(Click on Technical Chart above to Expand)

 In the new normal, i.e. the economic cycle of rising rates, risk-averse passive-income assets will continue to be dumped off for other interest yielding assets offered by banks and insurance companies. Their yields will start to close up against REITS, Trusts and Defensive Stocks. Risk assets will have to be loaded up massively. This is the cycle we are in now. It is too bad that not too many people know what they are doing and how the international economies and financial markets actually work.

Keynote of DNA:
In rising interest rates environment, defensive stocks, reits and trusts lose their shine. Interest rates close up the gap between interest yields and dividend yields and cause selling pressure on these kind of asset classes. Other asset classes offered by banks and insurance companies will offer much better shine for the high yields and lower risks in rising rates environment (hence, Banks and Insurance Companies to benefit greatly). Cyclical stocks are often favoured in rising rates environment.

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