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Anonymous

03 Feb 2020

General Investing

What are some of the important tips for Beginners in investing REITs and ETFs?

Been reading some articles online on investing in REITs. However, I still wasn't sure how the whole process of investing in REITs as some articles say that we need to prepare additional cash to pay additional fees for the REITs we already bought (e.g to pay for management fees, tax all those?) Are there any fees I'll need to pay in between?
Also, does it actually work like a stock? If I buy a REIT at 1.20cent/unit, I receive the dividends & sell the REITs when the price increases to 1.50/unit?

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Yes, you need not put in more money. you could look up REIT at english language wikipedia and at Investipedia.

traditionally the companies were tax-exempt if they at least distribute 90% of the income as dividends to the investors.

if you have invested a bigger amount (under the caveat that the company flourishes in the future) you should receive nice regular income. however inflation should be acknowledged. The REITs of strong Singapore have a relatively high dividend yield (%). however those with the highest yields are not necessarily the best, since possibly they are riskier...

Generally you should profit (like with stocks) from:

#1 payed out dividends

#2 REIT market price increase (if at all, downturn possible) =

capital gains

As generally, single equity investing is very difficult and very risky. So I'd recommend passive investing with Singapore REIT ETFs, particularly the Lion-Phillip one (my private thinking) bye!

Ernest Yeam Wee Leong

30 Jan 2020

Content Creator at www.youtube.com/c/JustBeingErnest

Hi there, buying REITS and ETF is simlar to buying stocks as well. Just that REITS and ETF have certain aspects that makes it difference from stocks.

REITS may require you to put in more cash for rights issues which could be for them to raise funds to buy new properties. You do not need to pay for management fees as these are taken from the revenue from the rents.

If you buy a REIT today at $1.20, collect the dividend and sell at $1.50, the net amount you will get is the dividends plus capital gain minus the brokerage fees.
Hope the above helps

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