OUTLOOK

"Rally in Real Estate Stocks Ahead"

1/4/2008

We believe the Dow Jones Wilshire REIT Index is due for another rally.  From its close of 191.04 on 1/4/08, we expect the index to rally to 200 or more within the next 4 weeks.

This is the second trade that we have entered in the Real Estate Sector in the past two weeks.  The first trade was entered on 12/18/07 and exited on 12/24/07.  During that time, the Dow Jones Wilshire REIT Index rallied from a close of 203.50 on 12/17/07 to 218.82 on 12/24/07.  Since we exited on 12/24/07, the Dow Jones Wilshire REIT Index has declined over 12% to close at 191.04 on 1/4/08.  We consider this a second buying opportunity in Real Estate Stocks as prices are extremely oversold and dividend yields are attractive.

Mark Yuan, CFA