Skip to Content

How to play bond yields & real-estate stocks?

Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.

The Latest Q&A

Question asked

How to play bond yields & real-estate stocks?

Dear James If I am correct, Market Matters’ current view is that bond yields will rise a little further with the consequences being stock groups sensitive to such movements, for example, “growth" and Real Estate, will come under pressure, hopefully creating buying opportunities. Regarding Real Estate stocks specifically, Market Matters currently holds GMG in the Flagship Growth portfolio and SGP and CNI in the Active Income portfolio and you have recently covered GPT and DXS. Each has reported earnings this month, which importantly has supplied the market more up to date information. They’ve all come off a bit price-wise and one would expect, I think, they’ll come under further pressure short term, so if this scenario plays out and if Market Matters currently held none, which will the best picks in your opinion? Thanks Nick


Hi Nick,

You’ve interpreted our view perfectly i.e. we believe bond yields will rise a little further theoretically weighing on interest sensitive stocks, for example, “growth” and Real Estate, hopefully this will provide investors with solid buying opportunities i.e. MM is looking to buy the next leg lower in both but on balance we don’t believe either will make fresh 2022 lows, even if yields do make new highs.

As you say the Real Estate Sector has fallen overall after they reported although GMG recovered strongly on Thursday +4.1%, the million dollar question is always which stocks would be our first pick from here, or preferred picks in order although its a close run thing is : GMG, CNI, DXS, SGP and GPT but as we saw on Thursday and right through 2022 the sector as a group is highly correlated to each other.


image description
ASX 200 Real Estate A-REIT Index Weekly Chart
image description

Relevant suggested news and content from the site

Back to top