A Quick Review of All My January Trades

January was an exciting month for investors. After most of the good REITs rallied to close out December 2021, there were only a few bargains left. However, in January we saw great REITs suddenly thrown onto the clearance rack. It was a great opportunity.

We placed several trades in January that I want to recap here. This section won’t be showing up in any of our public articles on Seeking Alpha. It’s only for the people following our site. However, you are welcome to forward the e-mail to anyone you think would enjoy it.

Without further ado, here are our trades in chronological order:

On January 4th, 2022 we sold our shares of Dynex Capital (DX) at $17.02 to lock in a profit on the bouncing share price. Shares were up 11% in about two weeks despite a slight reduction in projected book value.

On January 6th, 2022 we purchased 70 additional shares of American Tower (AMT) at $260.80. We’re still in the hole for 4.1% on that purchase, but I’m confident it will turn out well. Everything else purchased in this update is in an unrealized gain.

On January 14th, 2022 we purchased another 111 shares of AMT. You might be noticing a trend here towards REITs with extremely high growth in AFFO per share. If not, you’ll see it soon.

On January 24th, 2022 we purchased 250 additional shares of Equity Lifestyle (ELS). Prior to this purchase we only had 164 shares, so this purchase more than doubled our allocation. It’s so hard to find a big sale on the two quality MH park REITs. Those are Sun Communities (SUI) and ELS. We already had a large position in SUI.

On January 27th, 2022 we placed 3 trades. We purchased 26 shares of Equinix (EQIX) at $685.50. This is a great data center REIT with outstanding growth in AFFO per share and it finally went on sale. Happy to get that position started.

Then we sold our shares of CyrusOne (CONE) at $89.27. CONE already has a buyout in place so the share price has hardly moved since the big jump on the announcement. We wanted to free up some cash since we were buying up shares of EQIX.

The third trade was closing out our position in Bimini Capital Management (BMNM) at $2.1656 (weighted average). This is a small stock with minimal liquidity. We highlighted the expected trade 8 times across 4 subscriber articles in the two months prior to the trade to ensure any subscriber could close out their position first if they wanted to. Given the poor liquidity, it was important to be explicit about those plans in advance. With the poor liquidity, we felt a bit trapped in a higher-risk position with no yield. It wasn’t a good fit for how we’ve decided to structure the portfolio. Not enough liquidity to trade in and out, but not the kind of low-risk dividend growth stock we use for our buy-and-hold positions.

On January 28th, 2022 we purchased 1,207 shares of Ready Capital (RC) at $13.58 per share. Ready Capital had been beaten down much harder than other mortgage REITs in January. Our research indicated that RC’s fundamentals should actually be holding up substantially better than peers in January. Since the fundamentals were better for RC than for many peers but the price had been plunging, we decided to enter a short-term trade. We’re looking for the price-to-book ratio to recover to generate a capital gain. So far shares already recovered 7%, so much of the upside has already occurred in the first few days. Shares have a huge yield, but it was the dramatic price action that brought us in.

That wraps up our summary of trades placed in January 2022. I’ll be working on the full Portfolio Update for subscribers over the next couple of days. Thanks for reading!

A bit of an obvious disclosure, but I’ll include it anyway:

I’m “long” the shares I purchased. I’m “not long” the shares I sold.

I also own several other shares that were purchased prior to January 2022.

If you liked the article, feel free to share:

If you’re reading this on the website or it was forwarded to you, you can subscribe here: