Red or Green REIT?!

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blind pool, commercial property, Franklin Templeton, Green Property, Green Property Ventures, Green REIT, GRN, IPO, Ireland, Irish property, Irish shares, Irish value investing, NAMA, NAV premium, Pat Gunne, Paulson & Co, Pimco, Stephen Vernon, The Great Irish Share Valuation Project

Green REIT (GRN:ID) is Ireland’s first real estate investment trust. And the first ISE main market listing in over 5 years (a shock for the somnolent exchange staff, I’m sure). In fact, the IPO was so unprecedented, even the Minister for Finance turned up – here’s his speech! Not to mention the press, who fell on the story like a pack of dogs. But really, what do you expect? If there’s one thing that unites people, it’s a fervent desire for property to increase in value. Which is particularly true of Ireland, especially now – we blew the bubble we had, and Lord we so desperately want it back…

Yes, bored real estate agents want to treat buyers like scum & regain the respect they deserve. Mortgage holders just want to return to break-even, so they can finally relax & enjoy those gigantic monthly mortgage payments for the next 20 years. Old tyme reporters are sick of being forced to write real (i.e. non-property & interior design) stories, while their ad departments are tired of calling ’round begging for business. The banks dread visiting their own bank manager (NAMA & the Dept. of Finance) – while acting the gombeen with recalcitrant borrowers is somewhat problematic when they were reduced to beggary themselves not so long ago. As for the politicians, they just want to close their eyes & wake up when everything’s alright again…and then take all the credit! Finally, we have the poor old taxpayer…he just dreams of getting back to the good old days.

Because property solves all problems – doesn’t it?!

But I have to confess, I’m more than a little fascinated by the Green REIT IPO. Is it me, or did we just hit an inflection point? Could this be a new zeitgeist we’re witnessing? Well, if the collective national psyche could will it, Ireland’s certainly right about bloody due now… Oh boy, that’s a huge subject to tackle – for the moment, why don’t we take a closer look at:

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Argo Group Interims – A Preview

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% of AUM, Andreas Rialas, ARGO, Argo Group, Argo Real Estate Opportunities Fund, AUM, Cyprus bail-out, intrinsic value, Investor Relations, shareholder activism, shareholder value, The Argo Fund

I expect Argo Group (ARGO:LN) will be releasing interim results in the next week or so. I’ve no desire to be a hostage to fortune, but I think we can make some intelligent assumptions about their results – and there’s an important issue I want to highlight:

Let’s begin with Assets Under Management (AUM). First, I obviously have no idea re subscriptions/redemptions! But rightly or wrongly, my impression is that changes in Argo’s AUM have been driven primarily by performance, at least in the past couple of years. [NB: See here – at our meeting earlier this year, Andreas Rialas committed to better disclosure re changes in AUM – breaking out gross subscriptions, performance & gross redemptions is standard practice for the majority of Argo’s listed peers].

I also have no insight into the performance of the Argo Special Situations Fund (SSF) – let’s assume AUM remains unchanged. We then have the Argo Real Estate Opportunities Fund (AREO:LN) – which last reported an adjusted NAV of EUR 68.5 mio. For Argo’s other funds, I’ve come across conflicting reports of YTD returns – I prefer to be conservative, so I’m fairly confident we’ll see the following returns (as of end-June 2013), at a minimum:

Fear & Greed (II)

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charting, diversification, Expected Value, falling knives, fear and greed, intrinsic value, investment checklists, momentum, portfolio allocation, position limits, stop losses, sunk costs, technical analysis, trading, value investing, value-trap

Continued from here.

I labelled as tricks some of the techniques I’m writing about here – which might have put off some readers. But surely you’ll try anything that might help combat the impact of fear & greed in your investing? Reconsidering, I’d now argue the five techniques I’ve already documented are actually essential tool-kit for any serious investor. Have another look, and I hope you’ll agree – to put it another way, it would be hard to argue your investing would actually improve if you omitted any of the following:

Learn To Love The Black Box:  Document all your investments, and analyze & learn from your mistakes.

Checklist It:  Develop checklist(s) for every stage of your investment process.

Valuation Orgy:  Value your investments using as many different valuation techniques & metrics as possible.

Watch What They Do, Not What They Say:  Focus on facts, figures & performance, not just the ‘story’.

Well, Are You The Right Size?:  Set pre-defined position limits within your portfolio.

However, a majority of my remaining techniques do perhaps deserve to be called tricks. Which means they may, or may not, suit your investing style & personality. Trouble is, how will you ever know if they’d work for you, unless you give ’em a whirl..?! Or figure out how they’re best adapted to your particular circumstances? Right, let’s soldier on:

vi) Learn Some Bloody Voodoo

Fear & Greed (I)

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biofeedback, black box, fear and greed, home bias investing, investment checklists, literature, Nudge, portfolio allocation, The Checklist Manifesto, trading, value investing, value-trap

Great traders don’t necessarily have to be that smart, but mastery of their emotions – specifically, fear & greed – is absolutely essential. The same is equally true of great investors, except it just happens in slow(er) motion… But most people end up choosing investing over trading. Which is pretty fortunate – the trading gods delight in seeing meticulous logic & analysis abruptly savaged by fear & greed.

Many would-be traders never recognize this, and fail accordingly. Others grasp it, but remain trapped in a never-ending struggle. Only the brave few ever learn to fully master these emotions. Investing, on the other hand, seduces you with the luxury of time & positive long-term equity market trends. Which often makes it far more difficult to recognize the corrosive impact of fear & greed on your portfolio returns. The fact many of us shy away from any kind of critical self-examination doesn’t help either. But there are two solutions available to us:

The first is reading. In my last post, I argued for an important alternative to most investors’ non-fiction diet – literature, and lots of it. The great novels, plays & poetry are windows into the hearts & minds of other people – and in turn, yourself. Learning to actually recognize emotions like fear & greed in yourself, and their potentially disastrous impact on your investing, is the first & likely most difficult part of the battle you face.

Now, I didn’t cover the second solution – how to actually conquer those emotions. Because unfortunately, when it comes to that challenge, we are all truly alone…