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Update For Equity REIT Basket Strategy As Of 7/24/15

|Includes: BRG, DREUF, FREL, IRC, Independence Realty Trust (IRT), MPW, NWHUF, OHI, VNQ

Over the past several weeks, fewer stocks have been supporting upward moves. Underneath the major index levels, a variety of industry sector bear markets are in bloom. The most severe bear market is probably in commodities across the board, as reflected in the iShares S&P GSCI Commodity-Indexed Trust price chart and energy sector charts. GSG Interactive Stock Chart; FCG Interactive Stock Chart; PICK Interactive Stock Chart, XLE Interactive Stock Chart; IEZ Interactive Stock Chart.

This growing rot can be seen by a variety of indicators, including the number of stocks hitting new 52 week highs or lows as well as up/down volume: New Highs/Lows; Markets Data Center-WSJ.com

The VIX is still in a Stable VIX Pattern as defined by my Vix Asset Allocation Model which has street creed for me: Vix Asset Allocation Model - South Gent | Seeking Alpha

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Unlike prior updates for my REIT basket, I am organizing this post into several sections, including an "Appendix" at the end which has snapshots of recent buys.

I last updated this basket strategy in this SA Instablog published on 3/19/15. Update For REIT Basket Strategy As Of 3/19/15 - South Gent | Seeking Alpha

In that post, I stated that valuations for most U.S. REITs were "stretched and unappealing". The then latest Lazard monthly report showed that aggregate Price to Funds from Operation (P/FFO) "was near an all time high even after the sell off during February in response to the spike in intermediate and long term interest rates". REITs were then selling 5% above their net asset value as of 2/28/15.

Whenever I link that report, the reader will be taken to the latest month: Lazard_REIT Report.pdf Page 3 contains the relevant data.

As of 6/30/15, the report notes that the "dramatic price declines over the past quarter have brought REIT P/FFO valuations much closer to historical averages". The aggregate P/FFO had fallen to 16.8. The P/FFO declined to below 10 during the most recent stock meltdown in 2008. The REITs were trading at a 8% discount to underlying net asset value as of 6/30/15. Naturally, I start to swing back into this sector after selling some stocks earlier in the year, particularly as interest rates have started to inch back down.

I manage the REIT and Regional Bank baskets in tandem based in large part on interest rate movements. The regional bank basket is viewed as a natural, though imperfect, hedge for the REIT basket when rates are rising, while the REIT basket will generally perform better when rates are falling.

I was hurt today by owning Canadian REITs and three small externally managed REITs. Larger U.S. REITs propelled REIT index ETFs into the plus column. Realty Income (NYSE:O) and Omega Healthcare consequently did better than anything else presently owned in this basket. Several of my recent purchases were REITs in the doghouse, as is fitting for a contrarian investor.

This particular sector basket includes both common and preferred REIT stocks.

The common shares or units will include both U.S. and Canadian REITs.

My Canadian REITs are dragging the portfolio's performance down. I do not measure their performance based on the USD equivalent prices but on the relevant CAD costs and current values. I am a long term holder of CADs. The conversion into USDs impacts only my U.S. tax obligations, where the value of dividends and profit/losses are measured in USDs even though I am receiving distributions in CADs and am using CADs to purchase and receive CADs when I sell. See Items 1 and 6: Stocks, Bonds & Politics: SOLD: 300 HLP-UN:CA at C$14.17 and 300 AX-UN:CA at C$15.71

I will trade ETFs as part of this basket.

The ETF transactions will include one or more of the following, which can be purchased commission free in one of my brokerage accounts (as of today):

The following links are to the sponsor's websites:

Vanguard REIT ETF (NYSEARCA:VNQ) (commission free in a Vanguard Brokerage account; .12% expense ratio; 145 U.S. REITs)

Vanguard Global Ex-U.S. REIT ETF (NASDAQ:VNQI)(commission free in a Vanguard Brokerage Account; .24% expense ratio; 634 stocks)

Fidelity MSCI Real Estate Index ETF (NYSEARCA:FREL)(commission free in a fidelity brokerage account; .12% expense ratio; 187 stocks)

Ishares International Developed Real Estate (NASDAQ:IFGL)(commission free in a fidelity brokerage account; .48% expense ratio; 203 stocks)

I recently bought FREL as a trade.

I will monitor one REIT ETF which can not be bought commission free by me:

IQ US Real Estate Small Cap ETF (NYSEARCA:ROOF)(.69% expense ratio and includes mortgage REITs)

I compare my basket's 2014 performance with VNQ in this post: Stocks, Bonds & Politics: Update for Equity REIT Common and Preferred Basket as of 1/21/15

The preceding table does not reflected shares purchased with dividends.

Why Own Equity REITs:

Mortgage REITs own paper and are leveraged at significant multiples to equity. Equity REITs own real estate that is generally valued at about one-half of their debt, give or take a few percent.

An important question for investors is the rationale for having an allocation to REIT stocks. Some of this discussion is for novice investors. A general overview for REITs can be found in this trade association publication: What is a REIT? | REIT.com

1. Income: A REIT has to pay out 90% or more of its net income in dividends. It is a pass through entity that is not taxed at the corporate level for income paid out to its shareholders. The advantage of that tax status is dividends will typically be higher than for a regular corporation. The main disadvantage is that capital is not being retained to grow the business.

Income generation for new purchases becomes less appealing after stock price spikes and more attractive when prices decline.

2. Potential for Capital Appreciation: As real estate properties appreciate in value, stock prices will reflect that increase, though imperfectly and within a volatile range. There will also be significant variation in capital appreciation among the REITs, even those in the same sector, based on a variety of factors including the competency of management.

Vanguard REIT ETF (VNQ) Total Returns Based on Price (as of 7/22/15):

1 Year: +6.93%

5 Year Annualized: 14.02%

10 Year Annualized: 7.29%

After a 35.19% rise in 2006, the total return for VNQ fell -16.4% in 2007 and -36.94% in 2008.

The 2007 result was an unfavorable negative correlation with the S & P 500 ETF SPY which gained 5.14% that year. SPY Total Returns

VNQ's 2008 performance is what I call negative positive correlation, that is, going down in tandem with other asset categories.

SPY's total return in 2008 was -36.81% compared to VNQ's -36.94%. REIT investors had their commitment to this sector challenged in 2007-2008.

TLT's performance in 2008 was a positive negative correlation, going up when other asset categories are going down.

VNQ would have benefited the portfolio, compared to SPY, in 2005, 2006 (significantly +35.19 vs. +15.85%), 2009, 2010 (significantly 28.37% vs. 15.06%), and 2011 (8.62% vs. 1.89%)

When designing a portfolio, I want to add and subtract asset classes based in part on their correlations to one another. The 2008 meltdown was unusual in that virtually all asset classes were in a strong negative positive correlation (all going down a lot).

Asset correlations are dynamic and are subject to change based on valuations, investor interest and most importantly the big picture macro events. An investor who believes that asset class correlations remain relatively constant needs to go back to the drawing board.

3. Correlation Characteristics: This sector often has a low positive or negative correlation with other asset classes and sectors.

I view it as important when designing my portfolio to look at correlation matrixes.

This site has correlation matrixes that go from short to long term time horizons.

Assetcorrelation

See, also: ETF Screen - Correlation for Fund; Historical Returns; Stock-Bond Correlation-Pimco Publication; Vanguard 2012 Booklet On Correlations.pdf

4. Some Inflation Protection: Lease agreements with tenants will generally have a rent escalator tied to inflation. However, this benefit can be reduced or eliminated by a rise in debt financing costs.

5. A Convenient Way to Invest in Real Estate and to Achieve Diversification in Categories: I am not about to fool with buying real estate and dealing with tenants. I can acquire indirect ownership and cash flow participation through the REIT structure.

REITs have been benefited from a long term secular decline in interest rates and have been able to refinance debt at historically abnormal levels over the past several years.

Ten Year Treasury Chart 1962-

10-Year Treasury Constant Maturity Rate-St. Louis Fed

REIT Prices and Interest Rate Movements

Since the 3/19/15 update, equity REITs have declined significantly in price.

The low cost Vanguard REIT ETF (VNQ) closed at $84.9 on 3/19 and had declined to $78.05 as of today's close.

Over the past several years, there has been a tight positive correlation between REIT stocks and the ten year treasury yield.

Recent 10 Year Treasury Yields and VNQ Price:

5/1/13 1.66% $74.68

12/31/13 3.04% $64.56

2/2/15: 1.68% $86.32

3/6/15: 2.24% $80.37

4/3/15: 1.85% $84.83 (4/6)

6/26/15: 2.49% $75.9 (ex dividend for $.762)

7/23/15: 2.28% $77.74

7/24/15: 2.27% $78.05

VNQ Historical Prices

Daily Treasury Yield Curve Rates

I discuss this topic in more detail in this Post: Scroll to "Risks" I also discuss the topic in my blog Gateway Post for REITs: Stocks, Bonds & Politics: Gateway Post: Equity REIT Common and Preferred Stock Basket Strategy

Purchases Since the March 2014 Update:

I discussed a few purchases made since my last update here at SA.

The first link below is to a preferred stock purchase, while the last link refers to a Canadian REIT purchase using my CADs.

REIT Basket Strategy: Bought CORRPRA - South Gent | Seeking Alpha (5/2/15 Post)

Eliminated BRG And Added To LXP-Roth IRA-Small Adjustment In The REIT Basket Strategy - South Gent | Seeking Alpha (5/1/15Post)

Added To Artis Real Estate: A Diversified Canadian REIT - South Gent | Seeking Alpha (4/16/15)(link to USD quote: ARESF Artis Real Estate Investment Trust-the symbol ending in "F" denotes ordinary shares rather than an ADR)

REIT Basket Strategy Added 100 CSG At $7.74 - South Gent | Seeking Alpha (3/28/15 Post)

Equity REIT Basket Strategy: Bought 200 Agellan Commercial REIT At C$9.13-Toronto Exchange - South Gent | Seeking Alpha (3/24/15 Post)

Newer adds include the following:

Healthcare REITs:

1. Omega Healthcare Investors (OHI): I added to my pre-existing OHI position recently.

My first share purchase occurred in December 2013: Bought: 50 NVS at $76.72, 100 OHI at $29.85 (12/23/13 post)

I still own those shares.

OHI recently announced a quarterly dividend of $.54 per share, up 1 cent from its prior payment. Omega Announces Twelfth Consecutive Increase in Its Quarterly Common Stock Dividend

Omega Healthcare Investors-Dividends

The recent dividend increase brings my dividend yield to about 7.21% for that lot.

I published several comment to this article about OHI: Seeking Alpha I am no longer leaving comments to SA articles.

I left another set of comments about OHI's past history and potential risks to this Brad Thomas article published last September. Omega Healthcare Is A Blue Chip Model Of Predictability - Omega Healthcare Investors, Inc (NYSE:OHI) | Seeking Alpha

In those comments, I focused on the risks inherent in OHI's business

Any company with a direct or indirect reliance on funding from the U.S. government faces possible adverse consequences resulting from a decrease in that funding.

OHI crashed and burned in 1999. OHI Interactive Stock Chart There was then a significant reduction in Medicare reimbursement rates that caused the bankruptcy of several large nursing home operators including GenesisHealth, Sun Health, Mariner and IHS. ABFJournal

Genesis emerged out of BK and is one of OHI's largest tenants now. The tenants concentrations as of 3/31/15 can be found in this SEC filed press release under the heading "Operator Concentrations". The percentages have changed due to OHI's subsequent acquisition of Aviv which closed on 4/1/15. Omega Completes Combination with Aviv REIT

10-Q for Q/E 3/31/15 (debt refinanced at pages 17-19)

My previous SA comments about OHI, which reflect significant discomfort with claims that OHI is a blue chip or that government funding risks are "extremely remote", can be found at South Gent's comments {e.g. comment dated 9/25/14)}

I will use the Funds Available for Distribution number rather than adjusted FFO for both valuation and dividend coverage purposes. The AFFO number includes a significant bump in revenues that are not actually received by the company. That line item for "non-cash revenue" was $.07 per share in the Q/E 3/31/15. It is an accounting fiction relating to straight line rents. I have discussed this issue repeatedly here, and the sum is significant for LXP as well. Real and recurring cash flow, which removes non-existent current revenues and includes recurring expenses, is the only metric to use IMO.

I like to point out that the government has not exactly planned ahead. The government's debt has already increased from less than $1 trillion (1979) to over $18 trillion now, with the baby boomers just starting to qualify for Medicare benefits. I read this story last week: Social Security disability fund now faces 'urgent threat' of 2016 shortfall-MarketWatch What a mess!

Nonetheless, given the dividend yield and recent history of dividend increases, I bought 50 more shares in a Roth IRA account near $35.

Back in February, OHI sold 9.5M shares at $42, with an over-allotment underwriter option to sell 1.425M more shares): Prospectus The underwriter's option was exercised (scroll to "Financing Activities")

The reimbursement issue has to be monitored closely. OHI is not going to fare well when and if the operators start filing for BK again.

2. Medical Properties Trust (NYSE:MPW): This REIT owns hospitals and other rehabilitation facilities.

Map of Facilities by Country and State

The current FFO estimates are for $1.23 per share this year and $1.35 next year. I am reinvesting dividends currently, except on a 50 share lot held in one Roth IRA where I am taking the distribution in cash.

My current position is 250 shares bought in the open market.

I exited my position in HCP, held in a taxable account, and may repurchase shares in the Roth. I have the same concerns now as I had in December 2013 when I bought 50 shares. Stocks, Bonds & Politics: Bought 50 HCP at $36.31 Brad Thomas has a more favorable view of HCP than I do. HCP-Seeking Alpha

I also harvested my profit in Physician's Realty (NYSE:DOC), bought at $13.75.

Physician's Realty Website

Hospitals will likely be a major beneficiary of Obamacare due to the extra pot of money now available to them.

Canadian REITs: All of my Canadian REITs make monthly distributions.

The ex distribution dates occur on the same day.

Distributions are taxed at 15% by Canada and are not exempt from withholding when held in a retirement account. The retirement account exemption is available for Canadian companies that are not pass through entities (e.g. taxes are paid at the corporate level). Consequently, I will buy them only in taxable accounts, where I can at least recover all or most of the foreign tax as a foreign tax credit under current law, as explained in this Schwab publication.

I added to the following Canadian REITs since 5/3/15:

1. Northwest Healthcare Properties Real Estate Investment Trust: I averaged down by buying 300 units at C$7.68. I now own 1,000 units.

This REIT currently owns 123 properties located in Canada, Brazil, Germany, Australia and New Zealand consisting of 7.8M leaseable square feet. Northwest is the largest non-government owner of healthcare properties in Canada. Company Profile - NorthWest Healthcare Properties

I last discussed this REIT when I averaged down at C$8.3:REIT Basket Strategy: Added 100 Northwest Healthcare Properties REIT At C$8.3 - South Gent | Seeking Alpha That post discusses currency risks for U.S. investors which has been acute over the past two years: CAD/USD A U.S. investor now has at least missed the negative impacts shown by that chart.

This REIT can be purchased using USDs in the Grey Market, which I avoid whenever possible: NWHUF Northwest Healthcare Properties Real Estate Investment

A two year currency chart simply shows that the currency issue has just made matters worse for a USD based investor:

NWH.UN Stock Chart

On the bright side, both NWHUF priced in USDs and the Toronto traded units priced in CADs have already been beaten to smithereens for a new purchaser, though time will tell whether the current prices are good entry points or mere way stations to more pain.

This REIT currently makes monthly distributions of C$.06667 per unit or C$.8 annually. NorthWest Healthcare Properties Real Estate Investment Trust announces July 2015 distribution At that rate the dividend yield is about 10.42%.

The decision to average down again was based in part on a significant purchase by the CEO Paul Dalla Lana and the Board authorization of a unit buyback.

Paul Dalla Lana Announces Acquisition of Trust Units of NorthWest Healthcare Properties Real Estate Investment

Press Release

I was also having difficulty explaining the price decline when looking at this REIT's financial reports. Those reports are downloadable here: Quarterly & Other Reports - Investor Information - Northwest Healthcare Properties

Sure, the AFFO payout ratio is too high, indicating that the distribution will not be increased anytime soon and a cut is a possibility. That is not unusual for Canadian REITs that generally have higher payout ratios than U.S. REITs with certain exceptions.

2. Dream Industrial Real Estate Investment Trust: I averaged down with the purchase of a 200 unit lot at C$8.18 (see snapshot below).

Dream Industrial owns 216 "primarily light industrial" properties comprising approximately 16.9 million leasable square feet. The properties are located across Canada.

I currently own 700 units.

I last discussed this REIT here: Equity REIT Basket Strategy: Added 200 Of The Canadian REIT Dream Industrial At C$9.03 - South Gent | Seeking Alpha

This REIT is currently paying a monthly distribution of C$.0583 per unit or C$.7 annually. Dream Industrial REIT July 2015 Monthly Distribution At that distribution rate, the yield is about 8.56% at a total cost per unit of C$8.18.

Toronto Exchange Webpage: Quotes

Last Earnings Report Q/E 3/31/15: Earnings

This ordinary units of this REIT are also listed in the U.S. Grey Market and are priced in USDs.

DREUF Dream Industrial Real Estate Investment Trust

Dream Industrial REIT Website

In addition to the CADs slide, Canadian REITs have been hurt by the decline in Canada's GDP largely due to the collapse in commodity prices. Canada GDP | 1960-2015 That issue would weigh more on Dream Industrial than Northwest Healthcare.

Apartment REITs:

1. Bluerock Residential Growth REIT (NYSEMKT:BRG): After selling BRG at $13.77, with those shares bought at $11.98 and $12.85, I thought that the decline back to the $12.5 was an attractive re-entry point. I now own 250 shares.

I discussed buying shares in this earlier post: Equity REIT Basket Strategy: Added 100 BRG At $12.85 - South Gent | Seeking Alpha I have bought and sold a 50 share lot in the Roth IRA. Those shares were likewise sold at $13.77, generating a $75.49 quickie profit and a 19.56% total return with the monthly dividends (snapshot at Eliminated BRG)

BRG is an externally managed REIT that owns apartments.

Bluerock is currently paying a $.0967 per share monthly dividend. Dividends

Assuming a $12.5 total cost per share, the current dividend yield would be about 9.28%. It remains to be seen whether BRG can maintain that level. As a new REIT, it will need to grow into it.

Another problem is that this REIT is growing in part by selling stock in public offerings that will generally knock the price down. BRG last sold stock to the public at $13, with the underwriters paying $12.35.

Prospectus; BRG Announces Closing of Public Offering of Class A Common Stock and Full Exercise of Underwriters' Option

Website: Bluerock Residential Growth REIT (BRG)

SEC Filings: SEC

10-Q for the Q/E 3/31/15

Press Release 1Q Earnings Report: SEC

Properties:

AFFO:

An investor presentation made in July 2015 is available for review at BRG's website

Bluerock entered the Russell 2000 and Russell 3000 indexes in late June.

Links to Recent News: BRG to Purchase 252-Unit Century Palms at World Gateway in Orlando, FL; BRGl Invests in Cheshire Bridge, a Class A 285-Unit Luxury Apartment Development Project in Atlanta;BRG to Purchase 473-Unit Ashton Reserve in Charlotte, NC; BRG Acquires 288-Unit Class A Fox Hill Apartments in Austin, Texas; BRGl to Develop Class A Multifamily Community in Texas Medical Center Vicinity with Trammell Crow Residential; BRG Completes Sale of 23Hundred@Berry Hill in Nashville for $61.2 Million; BRG Announces Closing of Public Offering of Class A Common Stock and Full Exercise of Underwriters' Option (January 2015, sold at $12.5 per share)

For whatever it is worth, Oppenheimer initiated BRG coverage with an outperform rating. In January 2015, Wunderlich reiterated its buy rating and raised its target price to $15.75.

The current FFO estimates are $.52 this year and $1 in 2016. BRG Analyst Estimates

I am back up to 250 shares after eliminating my position back in May.

2. Independence Realty Trust (NYSEMKT:IRT)

IRT is an externally managed REIT that owns apartments. IRT Reit

IRT pays a monthly dividend at the current rate of $.06 per share:

Independence Realty Trust Announces Third Quarter Monthly Cash Dividends on its Common Stock

Assuming a total cost of $7.7, my last purchase price, the dividend yield is about 9.35%.

Map of Apartment Locations: IRT Reit (click red tag for pictures)

Link to SEC Filings

Link to Last 10-Q

Link to 2014 Annual Report 10-K

Snapshot from Q/E 3/31/15 Earnings Release: IRT

Financial Data:

Properties as of 3/31/15:

Announcement on Acqusition of the REIT Trade Central: SEC (.4108 shares of IRT for each Trade Central share)

If the acquisition of Trade Central consummates, the IRT's will achieve a significant bump up in size:

Sourced Page 8 June 2015 Investor Presentation

Trade Street Residential current trades under the (NASDAQ:TSRE) symbol.

Other Recent News Items: IRT Acquires Indianapolis, IN Apartment Community; IRT Announces Tax Treatment of Dividends in 2014; IRT Acquires Austin, Texas Apartment Community

For whatever it is worth, Deutsche Bank reiterated its buy rating but reduced its price target to $10.5 back in May. IRT was mentioned favorably in this article, Four Buy and Hold Stocks for Millennials, published by Investopedia.

The current FFO estimate is $.8 per share this year and $.95 next year: IRT Analyst Estimates

I am now up to 500 IRT shares.

Chart Looks Horrific: IRT Interactive Stock Chart

The company summarizes risks incident to its operations starting at page 6 of the 2014 Annual Report. 10-K

For both BRG and IRT, the dividend yields are over 9% based on my cost. I would be satisfied to harvest those dividends without losing any money on the shares.

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This is an appendix to the post.

The following encapsulates the general trading strategies used for sector basket strategies, given my emphasis on capital preservation and income generation.

I slowly add and reduce the allocation, usually in small 50 to 100 lot trades.

I do not move anywhere fast. A turtle with disabilities would have more speed.

As usual, I may sell my highest cost lot when and if the price pops, keeping my lowest cost lots, and then buy back when and if the purchase price lowers my average cost per share.

U.S. REIT dividends are generally excluded from the qualified dividend category, though occasionally some miniscule amount may qualify for the 15% tax cap. Most of the dividend payments will be taxed as ordinary income (same as interest payment or short term capital gains). A portion may be classified as a return of capital that will reduce the investor's tax cost basis but will not be subject to federal income taxation as a dividend.

Many wealthy investors will consequently buy equity REITs in a retirement account since the distributions will be taxed at their highest marginal rate.

Since I am retired with no pension (other than SS) and have no earned income, I am not that concerned about the tax issue and will consequently own REITs in taxable accounts for their income generation. I am spending now about 1/2 of my income generation to meet retirement expenses.

In addition, the return of capital portion will not be taxed until the security is sold, and then it may be possible to qualify for the long term capital gains tax rate (15% for me), assuming of course there is a gain even after the downward adjustment in the cost basis. Some positions with significant ROC payments may even be held until my death where my heirs can step up the cost basis. Cost Basis

Snapshots of Some Purchases:

Purchases in a Satellite Taxable Account:

BRG-Satellite Taxable Account

MPW-Satellite Taxable Account:

IRT-Satellite Taxable Account:

For anyone unfamiliar with my reference to satellite taxable accounts, I am referring to accounts that have historically been used for investments other than individual securities.

In the satellite taxable account referenced above, I originally had only a savings account used to purchase certificates of deposit using generally a 6 month to 2 year ladder.

When those CDs matured, and given the ridiculously low rates then prevailing due to the FED's 6+ year Jihad against the Savings Class, I opened a linked brokerage account and have used money, formerly parked in bank CDs, to buy dividend paying stocks.

For this account, I will revert back to bank CDs when and if I ever see a 4%+ rate again. I still have as mementos some long cancelled CDs from the early 1980s when the interest rates were close to 15%.

ROTH IRA Purchases-Two Accounts:

OHI at $35.36:

IRT at 7.56

Last Sold at $8.92 (see below):

IRT at 7.7 (another ROTH IRA account-currently at 250 shares in this one)

SRC at $9.98 (currently at 150+ in this account)

Last Sold: Sold 100 SRC at $12.78 Roth IRA

MPW at $13.81:

Last Sold: Sold 100 MPW at $14-Regular IRA (bought back 50 at $12.33 and still own that lot)

LXP at $8.49:

Last Sales: Sold 54 LXP at $11.44 Vanguard Roth IRA (1/27/15 Post)-Transitioning Position to Fidelity Roth IRA; Sold 101+ LXP at $10.65

All of my LXP shares are now held only in a Fidelity ROTH IRA for reasons discussed here: Lexington REIT (NYSE:LXP) - South Gent | Seeking Alpha I receive a 5% discount on the reinvestment price only in my Fidelity accounts. Since the discount is taxed as pretend dividend income, I avoid that tax issue through ownership in the Roth IRA. I no longer have funds in a regular IRA having transferred all positions to the Roth IRA accounts. When I first started an IRA, around 1980, the only option was a regular IRA. The Roth IRA fits into my long term investment plan better, since I can allow the funds to accumulate on a tax free basis without a required withdrawal, until I need them which most likely will be never.

The reinvestment price for the last dividend was $8.19:

BRG at $12.55:

LAST SOLD: Eliminated BRG at $13.77- South Gent | Seeking Alpha

IRC at $10.27

Last Sold: Sold 206+ IRC at $10.945

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Canadian REITs:

Northwest Healthcare at C$7.68:

USD Priced Ordinary Shares- U.S. Grey Market: Northwest Healthcare Properties Real Estate Investment (OTC:NWHUF)

I bought the Toronto listed shares priced in CADs.

Dream Industrial at C$8.18:

USD Priced Ordinary Shares-U.S. Grey Market: Dream Industrial Real Estate Investment Trust (OTC:DREUF)

I bought the Toronto listed shares priced in CADs.

Realized Losses Since the Last Update: Both ARCP and CCG eliminated their dividends and I sold my shares in both REITs at a loss. The total loss came to $1,246.88.

ARCP was a less than optimal selection.

Less Than Optimal=Lamebrain

I kept noting here at SA that prior ARCP management, now dumped en masse, could not be trusted, receiving more than a few personal critiques from commenters like Gratian who questioned my sanity for stating facts consistent with that opinion, rather than reality creations so commonplace among the ARCP True Believers. My Response to Gratian

So, what is worse, someone who is blind (self-inflicted) or someone who sees and fails to act? Both achieve a similar result by following different paths.

I am certainly subject to error creep, as Left Brain will gladly discuss with many illustrations, and one category is described as follows:

Stocks, Bonds & Politics: ERROR CREEP and the INVESTING PROCESS

It is due to what the Left Brain (the "LB") calls the "Unholy Alliance Between the Old Geezer and Right Brain, two peas from the same pod"

Gratian kept using the phrase "tiger in the tank" when referring to the former CEO Nick Schorsch. LB took one look at that guy's picture and instantly issued a warning ignored by other staff members. Nick Schorsch

I no longer make comments outside of my own SA Instablog.

ARCP - South Gent Seeking Alpha

South Gent's Comments on ARCP: American Realty Capital Properties Inc | Seeking Alpha

Then, low and behold, accounting fraud was revealed.

I offset those losses in part by selling 50 HCP, 100 DOC, 140 CORR (sold at $6.91), 100 IRT, and 30 EPR bought at $50.72. I later bought back and even increased the IRT position.

Disclaimer: I am not a financial advisor but simply an individual investor who has been managing my own money since I was a teenager. In this post, I am acting solely as a financial journalist focusing on my own investments. The information contained in this post is not intended to be a complete description or summary of all available data relevant to making an investment decision. Instead, I am merely expressing some of the reasons underlying the purchase or sell of securities. Nothing in this post is intended to constitute investment or legal advice or a recommendation to buy or to sell. All investors need to perform their own due diligence before making any financial decision which requires at a minimum reading original source material available at the SEC and elsewhere. Each investor needs to assess a potential investment taking into account their personal risk tolerances, goals and situational risks. I can only make that kind of assessment for myself and family members.

Disclosure: I am/we are long O, OHI, MPW, LXP, IRT, IRC, SRC, BRG, FREL, DREUF, NWHUF.