How many expats are living from dividend stocks?

[SpokaneAl]

ETFs usually have lower ongoing management fees than funds. Sometimes much lower. That particularly applies to index-trackers.
 
I am lazy and I have very little faith in the abilities of fund managers, so I generally just buy index-tracking ETFs.

The vast majority of our investments are in index tracking mutual funds, with management fees that close to if not equal to ETFs. If one wishes to reinvest dividends and capital gains that can be more difficult vis ETFs.


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[KittenKong]

8 minutes ago, SpokaneAl said:

The vast majority of our investments are in index tracking mutual funds, with management fees that close to if not equal to ETFs. If one wishes to reinvest dividends and capital gains that can be more difficult vis ETFs.

Not in the UK. Maybe it's different in the US.

[Percy P]

On 5/18/2019 at 12:51 AM, wordchild said:

You must have bought it a really really long time ago! It’s got a pretty good dividend yield these days, but the medium/longish term share price performance has been pretty dull. BP had a higher share price than the current one 20 years ago!

No problem, I keep them for the dividend. 

[Thailand J]

On 5/19/2019 at 6:57 PM, fletchsmile said:

SG REITS

While you get higher dividend, the Total Return, TR looks a lot like S&P 500.

Total return=dividend +price change.

Edited May 21, 2019 by Thailand J

[edixon15]

I have been doing well using dividend stocks, and a solid portfolio that has returned great positives with minimum diversification. The approach I have been using is this:

 

- ETFs for sectors I know have solid macroeconomic outlook for LONG term growth but I need diversification and I'm not specialized in. 

- A hand full of sector stocks where I do not mind following the company's performance though out the year, and operates in a sector I know like the back of my hand. (technology) 

- Municipality Bonds for tax savings and risk diversification 

- Select international holdings 

 

I am lucky enough to have friends and family back home that are too busy \ do not care to manage their retirement accounts or risk money so we've started a private fund that does well. Honestly I wish I would have moved to South East Asia 10 years ago, and become a private fund manager, generating income and helping people directly is far my rewarding than my old life in the cub farms of Corporate America. 

 

Here is a screen shot of the usual portfolio I make with the investment period running from January 30th to today, with an over all 11.18% return beating the S&P 500 by about two and a half percent. Been a rather easy ride, even with the "trade war" raging all around. Maybe I will start my own ex-pat Berkshire Hathaway.  (hahaha.) 

 

 

Edited May 22, 2019 by edixon15
Additional Information

[Pravda]

I have a $1800 rental back home but it in no way covers living in Thailand. After property tax, condo fees, insurance and 25% non resident tax I get barely 50% left.

[edixon15]

On 5/7/2019 at 6:49 PM, HNWI said:

I invest in US, Chinese stocks mostly. Growth stocks, spec stocks, value stocks and dividend stocks. Obviously they fall in a few categories. 

 

Ark ETFs are a good call for the lazy investors.

Have you payed attention to the Medical Marijuana stocks in the U.S.? The returns have been impressive as new states come on line with legalization. 

[edixon15]

3 minutes ago, Pravda said:

I have a $1800 rental back home but it in no way covers living in Thailand. After property tax, condo fees, insurance and 25% non resident tax I get barely 50% left.

25% That is terrible. Is that a U.S. property? 

[fletchsmile]

18 hours ago, Thailand J said:

While you get higher dividend, the Total Return, TR looks a lot like S&P 500.

Total return=dividend +price change.

Think you totally missed the point. It's not just about returns, and other objectives are in play, such as risk, liquidity, income, FX, tax etc. I wanted:

 

1) Income stream. Much higher than S&P. Linked to 5) as well

 

2) Porftolio diversification. I already have enough US exposure and equity exposure. Property linked assets outside US therefore appeal

 

3) SGD dollar exposure rather than USD exposure. The graph above takes no account of FX in the returns. Nor in the risk. SGD correlates much closer to THB than USD does. Hence I prefer the lower FX risk. Very useful in Thailand. I would actually accept a lower return in SGD as it gives me lower volatility than USD. 

eg

SGD over 10 years is -3% vs THB and since start of this century +2% so much more stable than

USD over 10 years -8%; and since start 21st century -15% 

In addition to the risk element the graphs above the returns also need adjusting for currencies.

To understand the risks I'm taking about you might want to rebase both to THB, using annual THB equivalent returns

 

4) Tax. Zero tax on SG REITs for me, no CGT no div taxes, no admin reports etc. Unlike US with its WHT and USD REITs that hammer you

 

5) Better matching assets and liabilities: I also borrow in SGD at around 2.9%. I could borrow in USD but it costs over 3%. Hence the desire for the income stream . Income of around 6.5% vs interest expense 2.9% (based on Sibor) gives me a nice 3.6% or so margin with matched currency and funding my exposure thru leverage / borrowing. When I first started borrowing it was at just over 1%. There may reach a point I cut the positions if margins get too thin. But as long as the dividends roll in tax free and I earn a decent margin I'm not to bothered about market price fluctuations short-mid term

 

As a Brit living in Thailand I don't want to overdo US and USD exposure. 

 

You might also want to run that graph or similar for the first decade of this century, where the S&P went nowhere to also see why a UK retiree in Thailand living off dividend income doesn't necessarily want too much S&P 500 exposure. The last 10 years for the US markets have been great. the first 10 years of the century were terrible ???? [Just to add I wan't in SG REITS at start of century either ]

 

Long term to be honest I would expect S&P to outperform the Singapore REITs index on a total return basis (Unadjusted for currencies and ignoring leverage) but I'm very happy to take the SG REIT positions even anticipating lower (unleveraged) returns because of factors above.

 

It's part of how I manage living of my investment portfolio. Won't suit everyone though, nor those looking for highest return without thinking about risks.

Edited May 22, 2019 by fletchsmile

[BaanOz]

On 5/8/2019 at 2:18 PM, RobMuir said:

As an Aussie expat, not registered for taxation purposes in Australia we don’t get the franking tax credits which is a bit of a bummer BUT we don’t pay any capital gains tax.

I think you can get both ????

As far as I know you will still get the franking credit benefit with money in an Australian super fund.

Edited May 26, 2019 by BaanOz

[rumak]

I keep my cash under my mattress and my gf on top of it.   And keep the door locked.

[RobMuir]

7 hours ago, BaanOz said:

I think you can get both ????

As far as I know you will still get the franking credit benefit with money in an Australian super fund.

Ok, thanks. I didn’t know that.

[kiever]

i am here too

[mshs]

 .

Edited May 27, 2019 by mshs