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Investing in REITs: A value-based approach

The primary purpose of this study is to test whether a value-based investment strategy will outperform a growth-based investment strategy when applied to SAREIT investment. The secondary purpose is to assess whether the SAREIT investor can discriminate between strong and weak value-REITs through sound accounting-based fundamental analysis using the F-Score Model. Building on existing research on value-based investment strategies and market efficiency, this study offers an SAREIT perspective to the existing body of knowledge on value investing theory through portfolio selection based on P/NAV, P/E, P/CF and DY ratio analysis. The holding period returns of the respective value-based portfolios are compared to their growth-based counterparts for an examination of relative performance. The evidence from this research does not offer probabilistic support that a value-based approach to SAREIT selection and investment will outperform a growth-based approach, nor that it is possible to discriminate between financially strong and weak value-REITs through sound accounting-based fundamental analysis using the F-Score Model. Further research is required to develop the said strategies and models for application to the SAREIT sector.

Identiferoai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:uct/oai:localhost:11427/31485
Date05 March 2020
CreatorsBrits, De Villiers
ContributorsViruly, Francois
PublisherFaculty of Engineering and the Built Environment, Department of Construction Economics and Management
Source SetsSouth African National ETD Portal
LanguageEnglish
Detected LanguageEnglish
TypeMaster Thesis, Masters, MSc
Formatapplication/pdf

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