Friday, January 15, 2016

Journey To Retirement Part 3.3 -- Cambridge Industrial Trust

A year after the divestment and reinvestment of Cambridge Industrial Trust, I finally decided to divest all of that for good at $0.5256

Since the reinvestment last January under the Cashless/Strategic plan, the quantity accumulated is like 5% of the intended target.  In addition, there was no (or very low) capital involved, the sale proceed will be used to reduce the current 1.21% capital being incurred among the 5 stocks (Cambridge Industrial Trust, FrasersCom Trust, MapletreeCom Trust and Mapletreelog Trust).  With that, the capital cost of the Cashless/Strategic section has been reduced to 0.54% or equivalent of $0.204/share for the 4 of them (minus Cambridge Industrial Trust).

The reason for the divestment is simple.  The earning of Cambridge Industrial Trust has been declining since thus resulting in a decline of the distributable income.  The impact is for each distribution the scrip dividend being collected is shrinking.  With the weak fundamental (among the 5 of them) and declining distributable income in mind, the risk being exposed for me to continue accumulate will be high.  The risk to reward just does not justify for continuation.

While I failed to divest at a higher price mainly due to the fact that I wanted to wait for the 4Q earning to confirm it, the plus point is it can be considered as no loss in capital since it is under the Cashless/Strategic section.

Looking forward, I could just continue with the remaining 4 stocks in the Cashless/Strategic section or look for alternative candidate to replace Cambridge Industrial Trust.  Anything is possible since it all based on strategy.

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