Tokyo real estate plunge would hit Mitsubishi Estate – #SaxoStrats
One might say we are already late for the party, but we believe that Japanese real estate could weaken further. The five biggest real estate stocks in the TOPIX 500 Index are all down between 15-30% YTD and the biggest one – Mitsubishi Estate – is down 26%
Mitsubishi Estate weekly share price the past five years
Management and risk description
We're implementing this trade with a tight stop at 1,945 which is just above the high from September 21. This means the stop is around 4.5% away which is not much, but the reason for this is that we are betting on the trend continuing and don't wan't to be caught on a big mean reversion trade.
The trade lot size set by the Tokyo Stock Exchange is 1,000 shares equivalent to around $18,000 based on the current USDJPY and share price in JPY.
Entry: buy at market (latest price is 1,857.50)
Time horizon: It all depends on whether the downwards trend continues or not. With a tight stop this trade could end in less than a week, but if the trend continues this trade could last 3-6 months.
— Edited by Clare MacCarthy
Non-independent investment research disclaimer applies. Read more