$Lion-phillip S-Reit(CLR.SG)Context:I noticed that the prices of S-REITs were falling, and I saw this as a potential opp…

$Lion-phillip S-Reit(CLR.SG)

Context:

I noticed that the prices of S-REITs were falling, and I saw this as a potential opportunity to add to my existing position at a lower price. My thinking was that buying more units during the price decline could help lower my average cost and potentially improve my overall returns when the market recovered. Since I was investing with a longer-term perspective, I was willing to tolerate some short-term price fluctuations as I believed S-REITs could still provide relatively stable distribution income and opportunities for capital appreciation. However, I was also aware that falling prices could reflect concerns about interest rates, financing costs or the REITs' underlying performance, so I understood that the price decline did not necessarily mean the investment had become more attractive.

My trade:

I added to my existing S-REITs position as I wanted to take advantage of the lower prices and reduce my average purchase cost. Rather than committing a large amount of capital at once, I chose to add gradually so that I could manage my risk while maintaining exposure to the sector. My main reason for adding was the belief that the lower entry price could improve my potential returns over the longer term, while allowing me to continue receiving distributions from my investment. At the same time, I recognised that averaging down would increase my overall exposure to S-REITs, and that further price declines could result in additional losses.

Takeaway:

Next time, I would assess whether the price decline is driven by temporary market conditions or weakening fundamentals before averaging down, while setting clearer limits on my position size and checking that the REIT's distribution sustainability and financial health remain sound.