Wednesday, December 12, 2012

My Darling Stock Interrent (IIP.UN)

This is one of my very few success stories. I wanted to invest in an apartment REIT but it wasn’t easy to find it. There seem to be many commercial, office or industrial REITs but not apartment REITs. So I found IIP with a dividend around 8% and bought 1,000 (yes, I know this how small I play) shares at around 1.51 in Feb/Mar 2011. The stock had been hovering around this price and even lower for a long time.

I would have bought more but I did not have any cash at the moment and the financial nightmare of 2008 taught me not to leverage even if in some cases I should have (only a little). I would have liked to buy another 1,000 shares. After a while I had the money but the stock was at that moment around $2.2 and I did not want to pay 50% more for a stock even if I should have as the yield was still the appealing 5.4%.

My darling stock more than doubled at some point and it went over $4.00. It would have been nice to own 2,000 shares at that moment (however, I would have sold half of them at $3; this is my dream, most of the stocks I have to double, I sell half and I do not care what happens with the rest as I got my money back). So I 'panicked' (not to mention it was nice to make some profit for a change) and sold 300 shares. The share price did not make sense and sure the stock fell back then to $3.85, but today Dec 12 stands at $5.28!!!

What gives? What I am missing here? However, the answer seems to be here:
In their quarterly report, Mawer Investment Management noted that an average home costs 84% more in Canada than the U.S. ($372,762 versus $203,100). Also a Economist Magazine survey shows that Canada’s housing market is 54% overvalued, only slightly behind Singapore, Hong Kong and Belgium. On the same measure, the U. market is 19% undervalued.
The investor Francis Chou said in a recent report, “If there is a choice, it is better to rent rather than buy a house.”

So more people will have to rent because of the low affordability of the houses in Canada. 

Here are some of their properties. Aren’t they cute? $0.0000000000001 from everyone’s rent goes to me. I would like to wait at the each building’s door, hug everyone and say ‘Thank you!

1 comment:

  1. As for IIP, I wanted to propose another apartment REIT stock but now I am hesitating haha don't want you to crash it!

    Finally, can you please sell all your losing O&G stocks? I need a rally here :)