Stock Market 101: All about REITs

When it comes to investing in the stock market, there is a vast array of options available to suit various investment goals and risk appetites. Among the many investment avenues, Real Estate Investment Trusts (REITs) have gained significant popularity in recent years. If you are looking for a way to invest in real estate without having to buy a property yourself, REITs may be a good option for you.

We will delve into the world of REITs and explore the ins and outs of these unique investment vehicles. Whether you’re a seasoned investor looking to diversify your portfolio or a beginner seeking to understand the basics of REITs to equip you with the knowledge needed to navigate the world of real estate investment trusts.

What are REITs?

Real Estate Investment Trusts (REITs) are a type of investment that allows you to invest in real estate without having to buy a property yourself. REITs are companies that own and operate income-generating real estate, such as office buildings, shopping malls, and hotels. When you invest in a REIT, you are essentially buying shares of the company, which entitles you to a share of the company’s profits.

In the Philippines, REITs were introduced in 2009 with the enactment of the Real Estate Investment Trust Act (RA 9856). The Securities and Exchange Commission (SEC) regulates REITs in the country. To qualify as a REIT, a company must comply with certain requirements, including:

1. Ownership: At least 75% of a REIT’s assets must be invested in income-generating real estate properties.
2. Income Distribution: REITs are required to distribute at least 90% of their distributable income to shareholders annually.
3. Listing: REITs must be listed on the Philippine Stock Exchange (PSE) within one year from the SEC’s approval.

Benefits of Investing in REITs

• Dividend income: REITs are required to distribute at least 90% of their taxable income to shareholders in the form of dividends. This means that you can earn a steady stream of income from your REIT investments.
• Liquidity: REITs are traded on the stock exchange, which means that you can buy and sell them easily. This makes them a more liquid investment than other types of real estate, such as single-family homes or condominiums.
• Diversification: REITs can help to diversify your investment portfolio. By investing in REITs, you can gain exposure to the real estate market without having to put all of your eggs in one basket.

Risk of Investing in REITs

• Market Risk: Fluctuations in share value based on market conditions, interest rates, and real estate sector performance.
• Income Risk: Variations in rental income from properties affect dividend distribution.
• Regulatory Risk: Impact of changes in regulations or tax laws on profitability and operations of REITs.
• Management: Influence of the quality of a REIT’s management team on its performance.

What to consider when investing in REITs

• The type of REIT. There are different types of REITs, each with its own investment thesis. For example, some REITs focus on office buildings, while others focus on retail properties or hotels. It is important to understand the different types of REITs and choose one that aligns with your investment goals.
• The location of the properties. The location of the properties owned by a REIT can also be an important factor. For example, REITs that own properties in major cities are likely to be more stable than REITs that own properties in smaller towns.
• The management team. The management team of a REIT is responsible for overseeing the day-to-day operations of the company and making investment decisions. It is important to do your research and understand the experience and track record of the management team before investing in a REIT.
• The valuation. The valuation of a REIT is another important factor to consider. You should compare the price of a REIT’s shares to its underlying assets and financial performance to determine if it is undervalued or overvalued.

Here are the available REITs in the Philippines:

1. Ayala Land REIT (AREIT)
2. Double Dragon Properties REIT (DDMPR)
3. Filinvest REIT (FILREIT)
4. Robinsons Land REIT (RCR)
5. Megaworld REIT (MREIT)
6. Citicore Energy REIT (CREIT)
7. VistaREIT (VREIT)
8. Premiere Island Power REIT (PREIT)

These REITs are all listed on the Philippine Stock Exchange, so you can buy and sell their shares through a broker.

Remember to conduct thorough research, seek professional advice if needed, and make informed investment decisions based on your financial goals and risk tolerance.

In recent years, the stock market in the Philippines has witnessed a significant surge in popularity as more individuals seek to invest and trade their hard-earned money. As a result, the demand for reliable and efficient stock market brokers has also increased.

When choosing a stock broker, it is important to consider your investment goals, your trading style, and your budget. You should also compare the different brokers’ fees, platforms, and customer service.

Selecting the right broker can make a world of difference in your trading experience. Here are some factors to consider when choosing a stock broker for training:

• Fees: The fees charged by stock brokers can vary widely. It is important to compare the different brokers’ fees before you make a decision.
• Platform and ease of use: The trading platform offered by a stock broker is an important factor to consider. You should choose a platform that is user-friendly and that offers the features you need.
• Customer service: Customer service is another important factor to consider. You should choose a broker that has a good reputation for customer service.

We compiled a comprehensive list of the best stock market brokers in the Philippines, providing seamless trading experiences to both novice and experienced traders.

Best Stock Market Brokers for Seamless Trading

COL Financial (COL)

COL Financial is a leading online brokerage firm in the Philippines, offering a user-friendly platform and a wide range of investment options. With its intuitive interface and extensive educational resources, COL Financial caters to both beginners and seasoned traders.

The platform provides real-time market data, research reports, and tools for technical analysis. Additionally, COL Financial has a responsive customer service team to assist users with their trading needs.

First Metro Securities

FirstMetroSec, the online trading arm of First Metro Investment Corporation, stands out for its comprehensive market research and analysis tools.

The platform provides in-depth market insights, daily reports, and technical analysis charts to help users make informed investment decisions. FirstMetroSec offers a user-friendly trading interface, and its customer support team is readily available to assist users with any concerns or inquiries.

Philstocks

Philstocks is a popular choice among budget-conscious investors due to its low trading fees. Despite its affordability, the platform does not compromise on functionality.

Philstocks provides real-time stock quotes, advanced charting tools, and an easy-to-navigate interface. It also offers a mobile app for on-the-go trading. While primarily catering to self-directed investors, Philstocks offers additional services such as portfolio management and market research reports.

Choosing the right stock market broker is crucial for a seamless trading experience in the Philippines. With the right broker by your side, you can navigate the stock market with confidence and maximize your investment potential.

Remember to conduct thorough research, seek professional advice if needed, and make informed investment decisions based on your financial goals and risk tolerance.

Investing in the stock market has long been recognized as a viable means to grow wealth and achieve financial goals. It can be challenging for investors, both new and seasoned, to navigate the options and choose the approach that aligns best with their objectives. When it comes to investing, there are two main schools of thought: dividend investing and growth investing.

Dividend Investing vs. Growth Investing

Dividend Investing

Dividend investing is a strategy that involves investing in companies that pay dividends. Dividends are a portion of a company’s profits that are paid out to shareholders on a regular basis. Dividend investors typically look for companies that have a history of paying and increasing their dividends.

Advantages of Dividend Investing

• Income: Dividend investing can provide you with a steady stream of income. This can be helpful if you are retired or if you want to generate income to supplement your retirement savings.
• Safety: Dividend-paying companies are typically well-established and have a history of profitability. This makes them a relatively safe investment.

Disadvantages of Dividend Investing

• Limited growth: Dividend-paying companies may not have the same growth potential as growth stocks. This can lead to lower returns over the long term.
• Dividend cuts: Dividends can be cut or eliminated if a company’s financial performance declines.

Growth Investing

Growth investing is a strategy that involves investing in companies that are expected to grow their earnings over time. Growth investors typically look for companies that are in industries with high growth potential or that have a competitive advantage.

Advantages of Growth Investing

• Potential for growth: Growth stocks have the potential to grow their earnings at a faster rate than dividend stocks. This can lead to higher returns over the long term.
• Capital appreciation: Growth stocks can appreciate in value over time. This can lead to profits when you sell your shares.
• Potential for diversification: Growth stocks can help you diversify your portfolio and reduce your risk.

Disadvantages of Growth Investing

• Higher risk: Growth stocks are typically more volatile than dividend stocks. This means that their prices can fluctuate more, which can lead to losses.
• Lack of income: Growth stocks may not pay dividends, so you may not receive any income from your investment.
• Potential for value traps: Growth stocks that are overvalued can fall in price. This can lead to losses if you sell your shares at the wrong time.

Which is Right for You?

The best investment strategy for you will depend on your goals and individual circumstances. If you are looking for a steady stream of income, then dividend investing may be a good option for you. If you are looking for the potential for growth, then growth investing may be a better choice.

Remember to conduct thorough research, seek professional advice if needed, and make informed investment decisions based on your financial goals and risk tolerance.

Investing in dividend-paying stocks can be a smart strategy for investors seeking a regular income stream while also benefiting from potential capital appreciation.

In the Philippines, a growing economy with a robust stock market, there are several companies known for their consistent dividend payments. This article will highlight the top 10 dividend-paying stocks in the Philippines in 2023, based on their historical dividend track record and potential for future growth.

Top 10 Dividend-Paying Stocks in the Philippines in 2023

Stock Name	Company	Div Yield
LTG	LT Group, Inc.	13.51%
DMC	DMCI Holdings, Inc.	9.55%
TEL	PLDT Inc.	5.97%
MER	Manila Electric Company	5.50%
FLI	Filinvest Land, Inc.	5.34%
MBT	Metropolitan Bank & Trust Company	5.11%
GLO	Globe Telecom, Inc.	4.94%
RRHI	Robinsons Retail Holdings, Inc.	3.43%
FB	San Miguel Food and Beverage, Inc.	3.89%
RLC	Robinsons Land Corporation	3.10%

Remember to conduct thorough research, seek professional advice if needed, and make informed investment decisions based on your financial goals and risk tolerance.

In the world of investing, dividends serve as additional income for shareholders, offering a potential source of passive earnings and a key component of long-term wealth generation. As you delve into investing in the Philippine Stock Exchange (PSE), understanding the significance of dividends becomes crucial to unlocking the full potential of your stock market journey.

Stock Market 101: PSE Dividends

What are dividends?

At its core, a dividend represents a distribution of a company’s profits to its shareholders. When a company generates excess earnings, it has the option to allocate a portion of those profits as dividends to reward its shareholders. 

Dividends can be paid in the form of cash, additional shares of stock, or other tangible benefits, depending on the company’s policy. Dividends also provide a tangible measure of a company’s financial health and can signal its stability and potential for long-term growth.

Types of Dividends

• Cash Dividends represent a distribution of the company’s earnings to shareholders in the form of monetary funds, which is the prevailing and widely adopted method of dividend allocation.
• Stock Dividends entail to shareholders are provided with additional company shares instead of receiving cash dividends. This alternative approach is typically communicated to stockholders as a percentage increase in their ownership of shares.

Terms of Dividend Payments

1. Date of Record

Also known as the record date, it is the specific date set by a company to determine which shareholders are eligible to receive a dividend. Shareholders who are recorded as owners of the stock on the date of record will be entitled to the declared dividend. Anyone who purchases shares after the date of record will not receive the upcoming dividend payment.

2. Payment Date

This refers to the date on which the dividend is actually paid to eligible shareholders. It is the day when the company distributes the dividend amount to the shareholders’ accounts or issues physical checks.

3. Ex-Date or Ex-Dividend Date

The ex-date, often known as the “without dividend” date, is the specific day on which or after which shares of a stock can be traded without entitlement to the recently declared dividend. If investors buy shares on or after the ex-date, they will not receive the upcoming dividend payment. Usually, the ex-date is scheduled two business days ahead of the date of record to allow ample time for trade settlement.

4. Declaration Date

The declaration date is when the company’s board of directors makes an official announcement regarding the dividend payment. It is the date when the company publicly discloses the dividend amount and provides essential information, including the date of record, ex-date, and payment date. It is an important event for shareholders as it provides them with information about the upcoming dividend distribution.

These dates and terms are important for investors to understand when considering dividend investments and planning their trading activities around dividend distributions. It is advisable to check the company’s announcements and consult financial sources for the specific dates and details related to dividend payments for individual stocks.

Example of Dividends

Company	Type of Stock	Type of Dividend	Dividend Rate	Ex-Dividend Date	Record Date	Payment Date
Robinsons Retail Holdings, Inc.	COMMON	Cash	P2.00	May 17, 2022	May 20, 2022	Jun 10, 2022
JG Summit Holdings, Inc.	COMMON	Cash	P0.40	May 23, 2022	May 26, 2022	Jun 14, 2022
Filinvest Development Corporation	COMMON	Cash	Php0.07014	May 17, 2022	May 20, 2022	Jun 14, 2022

Remember to conduct thorough research, seek professional advice if needed, and make informed investment decisions based on your financial goals and risk tolerance.