Combine value and yield strategy with S-REITS - CIMB

Amid the current volatile market, CIMB suggests combining a strategy of looking for value from oversold stocks and putting money into high-yield stocks.It notes, since the mega-earthquake and tsunami that hit Japan on March 11, “most SGX-listed stocks have taken a beating” with the STI Index down 3.6% since March 10 close. “which typically offer better dividend yields relative to the average stock,” and were not spared in the selloff. “Some REITs fell more than the STI over this period despite the lack of exposure to Japan. Stocks like Frasers Commercial Trust (ND8U.SG), down 7.3%, and Frasers Centrepoint Trust (J69U.SG), off 5.3%, are examples.

These stocks may be oversold, and as such, could present traders an opportunity for accumulation,” offering attractive CY11 yields of 7.8% and 6.0% respectively post the sell-down.

It adds, changes in travel plans may benefit tourism plays, like CDL Hospitality Trust (J85.SG), yielding 6.5%, which has fallen 4.4% since the quake.