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Chuck,
Thanks for the info. Sure hope that's a triple bottom forming in the
index <G>. As far as any tax changes, I think it's too early to even worry
about that. it's evident that the Republicans and Democrats aren't going to
agree on anything and I'd be surprised if any major legislation gets
through.
JimG
-----Original Message-----
From: Chuck Engstrom <engstrom@xxxxxxxxxxxxx>
To: metastock@xxxxxxxxxxxxx <metastock@xxxxxxxxxxxxx>
Date: Tuesday, February 16, 1999 6:20 AM
Subject: Re: Weekly Pick
>At 05:19 PM 2/13/99 -0800, you wrote:
>.......
>> I think the Real Estate Investment Trusts (REITs) fit the bill here.
>>They have been in a down trend for over a year and their average yield is
>>now around 8% which is much higher than the money markets. If interest
>>rates hold steady or drop during the year (which I think will happen),
then
>>the REITs have to be close to their bottom on a yield basis. Therefore,
the
>>downside risk should be small. On the upside, real estate values and
rents
>>are on the rise. That should help the REITs earnings and the analysts are
>>expecting about 7% growth for the REITs this year. If we can get a 8%
yield
>>and 7% growth, that means about a 15% annual gain. That's much better
than
>>sitting in a money fund considering there is only a small additional risk,
>>but I don't want to over expose myself to REITs either. The answer for me
>>is to invest about 20% of my portfolio in REITs.
>>
>>JimG
>>
>>
>>
>
>
>Jim --
>
>Seems to me I heard something about Clinton's new budget proposals
>containing some significant changes in REIT tax treatment that would remove
>(of course) some of their tax-advantaged status and thus lower profits. I
>don't recall any details, but you might want to look at that issue.
>
>I do keep data of the REIT index (RIX), and I've attached a simple chart.
>
>Best regards --
>
>Chuck Engstrom
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