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AXA Property Trust (APT) announced today that they are going to wind-down and return capital to shareholders. At an estimated Net Asset Value (NAV) per share of 58.55p, it is trading at a 46.2% discount. They could have been bought as low as 24.5p just a few weeks ago.
Monthly chart of APT.
The trust’s objectives were to make money from European properties through dividends and capital appreciation but the price performance has been a disaster for those who bought in at launch in 2005. That’s now all history and the important thing is how efficiently they can sell down the portfolio and at what price.
I bought back at 32p this morning and although part of any gain will just get me my money back on a previously stopped out trade that was taken on the basis the fund would wind-up, I am happy with a gross yield to redemption of about 17% (at the time I bought and on basis they wind-up by end 2015). Beats cash.
The price rise today, currently 35p to buy, means that there is still possibly 30+% in it but of course that’s not a certainty.
APT demonstrates how ferreting round a sector can produce a nice return if one can spot the opportunity at the right time and ‘take the trade’.
Disclosure: at the time of writing the author holds APT
Susan Marmor has been trading her ISA and SIPP full time for 7 years. She has made money every year, including 2008. She believes that making money is about picking the right shares at the right time and using sound money management techniques to manage risk.
For her trading she uses a combination of sound fundamental data and technical analysis (which involves using price charts and some of the fancy bits and pieces that go with them). She runs the occasional seminar to show people what she does and how she does it.
Disclaimer:
Please keep in mind that all comments made by Susan Marmor are for educational purposes only and should not be construed as investment advice regarding the purchase or sale of securities, options, futures or any other financial instrument of any kind. Consult with your investment advisor before making an investment decision regarding any securities mentioned herein. Susan Marmor assumes no responsibility for your trading and investment results. Susan Marmor does not warrant completeness or accuracy for any observations made herein, or warrant any results from the use of the information. Susan Marmor may have a position in the securities and/or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. There is a very high degree of risk involved in any type of trading. Past results are not indicative of future returns. Securities, options, futures and any other financial instruments can go down as well as plunge.
Please note that in my original I incorrectly stated NAV as 46.2%, it is in fact 58.55p. I have edited to reflect that the discount to NAV is 46.2%.
By way of an update, and a reminder we are always up against ‘greater forces’, Oriel has put out a reduce note today. They argue shareholders might need to take a 20% haircut on NAV, and an uncertain timeframe. If they are correct then the NAV would reduce to 43p from here, still well above the 35p close but obviously not as attractive.