Let us get in your thoughts as to what the outlook is within the entire real estate space and where do you see potential?Real estate is the most sensitive sector to interest rates and valuation of real estate companies historically have followed the rate cycles. So I would think that we could still see a few more months of underperformance. Long term directionally, real estate is in a good cycle now, but I would still think that as news flow trickles in of a possible slowdown in sales, etc., some more downsides are possible in most of the real estate companies. But at that point of time, they could present opportunities.
If inflation is coming back, if China is opening up, the metal index should be the first one which should be racing ahead because if inflation is there, that means commodity prices will remain high.
All the metal stocks ran up in anticipation of higher Chinese demand but unfortunately, what most of the people did not factor in was that the Chinese supply will also increase and the supply increase possibly could be faster than what the demand revival in China is going to be. See, the Chinese economy is now stuck in a secular decline phase so obviously, from lockdown stage, it will see a revival, but then directionally, it is going to slow down going forward even further.
So, I think there is no big play per se in commodities. There will be specific commodities, obviously, which will have shortages, etc., which one can play but I think they could be in a long phase of sideways kind of move.