News & Politics, Personal Life

Thinking of investing in REITs

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So I’ve been thinking recently about opening a stock trading account for the first time and buying some shares on the Kuala Lumpur Stock Exchange. Granted, I already have money in various unit trust funds and insurance saving products, so I’m already indirectly invested in the markets, but I’ve never actually purchased shares for my own account before. What prompted the current interest is what looks to me like ridiculously attractive dividend yields on many of the REITs being traded here and the intense discussion this has generated on the Low Yat forums.

According to a popular blog on the subject that I’ve been folllowing on and off for the past couple of months, the average yield on the REITs based on current prices is a delicious 8.84%. One of the REITs most popular with the LYN folks, Axis, is listed as having a yield of 10.4%. Even better, Axis has a policy of redistributing 95% of its income and has recently moved to a quarterly distribution policy, meaning you get a nice fat cheque every 3 months.

In theory, investing in a REIT should be approximately similar to investing in property yourself, except that in return for a management fee, you are spared from the hassle of actually scouting for good properties, arranging to buy them and finding and managing tenants for them. Since the REITs are all at least partially funded using loans as well, this means that their yields are inflated by leverage, just as an individual investor’s yield would be in buying a property personally using a mortgage.

Being the pessimist and financial conservative that I am, however, I’m still somewhat wary of something that looks too good to be true. For one thing, the yields looks so good and the size of the REITs so small (Axis is worth by my calculations a mere RM 380 million or so, Atrium, another popular REIT is worth only around RM 120 million in total) that I don’t understand why institutional investors don’t just snap the whole thing up. I see that the Employee’s Provident Fund is already the largest shareholder of Axis, at 7.59% of total issued units, but what’s stopping the big players from just taking over such a sweet operation?

As always, I suppose there’s the risk of property prices dropping, tenants leaving or not paying rent (I understand Atrium gave everyone a scare when it announced a lawsuit against a big tenant over rent arrears earlier) and the value of the REITs dropping due to the general market sentiment, but it still looks like a stupidly good buy to me. Am I wrong? I’d appreciate it if anyone has any interesting comments on this before I pull the trigger on this.

Games

A Game: Midnight Club LA Remix (PSP)

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While I’m been away from my PC over the past week, I’ve been indulging my gaming habit with this gem of a game on my PSP. It’s essentially a shrunk down version of Midnight Club: Los Angeles for the PlayStation 3 and the Xbox 360 but it still packs an astonishing amount of content and will likely delight any racing fan for a good long while. It delivers seriously intense racing experiences, a very satisfying sense of progression over time and despite being somewhat repetitive and frustratingly difficult at times, a tremendous sense of achievement when you’ve finally won some of the harder races.

Midnight Club LA Remix is essentially an open world racer in which you drive around a complete and beautifully detailed city to find races to participate in, earning reputation, unlocking rewards and making money along the way. One of the things I liked best about the game is how much it felt like an RPG. Starting as a virtual unknown in a old and clunky car, you’ll painstakingly progress towards the flashiest and sleekest Mercedes and Lamborghinis. Unlike the Grand Theft Auto series, Remix uses actual cars and motorcycles from real world brands, so there’s that additional sense of realism.

Continue reading A Game: Midnight Club LA Remix (PSP) →

Science

Recent Interesting Science Articles (May ’09)

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I haven’t had as much on the Internet as I’d have liked this month, so apologies for having only two articles this time. The first one is an odd feature from New York Magazine that doesn’t really count as a real science article at all, but is relevant enough that I think merits inclusion. The article mentions in passing research by Kathleen Vohs of the University of Minnesota’s Carlson School of Management on how just the act of thinking about money influences how people act and behave.

In one experiment, she found that it was possible to influence how much people were willing to collaborate on group efforts simply by switching screensavers. Eighty percent of the group who had been given screensavers of floating dollar bills to stare at chose to work alone. Eighty percent of those who were given screensavers of exotic fish chose to work together with others. The article goes on to make some not entirely scientific generalizations about how the current recession can be seen as being a plus for changing people’s priorities and making them better people, but the initial point alone is good food for thought.

The second article appeared in The Economist and explores the link between creativity and the experience of living abroad. It covers research by William Maddux of INSEAD and Adam Galinsky, of the Kellogg School of Management in Chicago who used a simple test to determine the level of creativity of their test subjects and linked that to whether or not these people had any experience in living abroad. They found that sixty percent of those who had overseas experience managed to solve the problem compared to only forty two percent of those without that experience.

A follow up experiment aimed at measuring the participants’ ability to come up with creative solutions to difficult negotiating positions also turned up similar results, suggesting that it is the experience of living abroad opens minds to new possibilities and expands their creativity. One easy criticism is that their stated problem may not be a good test of creativity, especially the sort of creativity that is associated with writers and artists like Rudyard Kipling, Pablo Picasso and Ernest Hemingway, but my personal instinct is that they’re probably right and that living abroad should tend to open up the minds of young people and enable them to think out of the box. It would particularly interesting to see student exchange programmes being organized on a widespread and systematic basis to take advantage of this but that would likely be too expensive.

Personal Life

Holiday in Hong Kong

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In retrospect, scheduling a holiday to Hong Kong at this time was probably not the smartest decision possible. Between the H1N1 fears and the bad weather, our experience left much to be desired, but we still managed to have an enjoyable time overall and got to know Hong Kong more. Part of this was because it was a last minute arrangement and we were originally supposed to go with a tour group including older family members to Taiwan, but it was cancelled and my wife and I had to decide where to go on our own during our scheduled holiday time. And so to Hong Kong it was, including a day trip to Macau as pictured above.

What I mostly learned about Hong Kong is that it’s one huge contiguous crowd of people! Having never been to HK or even any part of China before, the sheer number of people was staggering to me. And all of them constantly walking briskly and purposefully from one place to another too. Indeed, one evening spent in Causeway Way on the day before the Rice Dumpling Festival was nearly standing room only on the streets. We met up with a couple of friends from high school who showed us the ins and outs of living in HK. To get a restaurant table, we had to get waiting tickets from four or five different restaurants and see which queue was the shortest. At the longest queue, the number currently being served was 61 while the ticket we had was 161. Between this sort of thing and the need to constantly walk between bus and MTR stations since hardly anyone actually drives in HK, I see that Hong Kongers get much more exercise than Malaysians.

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Games

A Quick Guide to the Ljosalfar

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Far from it for me to call myself any sort of expert on Fall from Heaven 2, but I thought there might be some interest in some simple guides for playing each of the factions in the game. They’ll include both stuff from my individual playing experiences and advice that I’ve read elsewhere on the net, most notably from the Civfanatics forums. I don’t know if I’ll ever actually complete playthroughs for each of the factions, but I’ll keep it up for as long as it holds my interest.

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Games

A Hero for a day

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The bad news is I’ve still yet to receive my copy of Grand Theft Auto IV, so no new game for me. The good news is that since I’m leaving on holiday on Thursday anyway, I probably shouldn’t start a new game for real just yet, so I decided to download a free trial for yet another MMO. The game I picked was City of Heroes, one of the more unique MMOs out there and one that I’ve often wondered about.

Until Champions Online launches later this year, CoH is still the only MMO that lets you play as a superhero (or a supervillain if you so choose). This means that it has an extremely powerful and versatile character creation system and is set in a contemporary cityscape, the so-called Paragon City. Unusually for an MMO, it has no auto-attacks. All attacks are essentially powers that must be manually activated. Furthermore, characters in CoH can physically obstruct one another and a crude physics system allows characters to be knocked down or even blown away a fair distance when hit by the appropriate power.

A few things were apparent from the first moment I started up the game. This game is old and looks it. Not only is the graphics engine terribly dated by now, but its interface, user friendliness and general game design all mark it as very much a pre-World of Warcraft MMO. What’s surprising is that even though CoH launched only a few months earlier than WOW, it looks a lot older, with plain textures and blocky polygons and is far less polished.

The character creation system is indeed as powerful as advertised and to me was probably the most fun part of my short trial. While the combat system felt suitably visceral compared to other MMOs, I was bothered by the fact that although characters use their powers on each other, there’s next to nothing that they can do with their powers to the environment. This felt silly to me and detracted from the experience. You’re not superpowered unless you can throw cars around and blow buildings up in my book. I was annoyed that gameplay seemed to consist mostly of grinding on random mobs or running missions in buildings with the same layouts over and over again. It reminded me unpleasantly of my very first MMO experience with Anarchy Online.

One nice thing that I noticed was that players were generally serious about their character and took the time to design a cool costume and picking an appropriate name. People who are already used to the multitude of dumb and meaningless names in MMOs should know how significant this is. Unfortunately, this game is still too dated and too clunky to warrant any extended interest on my part. I am however looking forward to Champions Online.

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Films & Television, Science Fiction

Star Trek is dead. Long live the new Star Trek

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Inevitably, I went to see the newest Star Trek film with my wife on Sunday. Now, I’ve always thought of myself as a Star Trek fan, even though I’m too young for The Original Series and it’s The Next Generation that is the most memorable for me. I never did get around to watching Deep Space Nine, only watched bits and pieces of Voyager and made a deliberate effort to avoid watching Enterprise.

Still, I’m reasonably up to snuff on the best parts of TOS and combined with the best parts of TNG, I have a very firm idea of what it is that makes Star Trek great: as a mainstream platform on which to tell high-brow science-fiction. After all, it’s not a coincidence that many of the very best episodes were written by the most notable writers of print-based science-fiction, for example, City on the Edge of Forever (TOS) by Harlan Ellison, The Measure of a Man (TNG) by Melinda Snodgrass, The Doomsday Machine (TOS) by Norman Spinrad etc. Plus, there’s the fact that Star Trek always had a single very clear vision: creator Gene Roddenberry’s dream of a unified and noble humanity venturing out to do good amongst the stars.

Continue reading Star Trek is dead. Long live the new Star Trek →

The unexamined life is a life not worth living