MoneyTalk

 

The Future For Dividend Investing

07 March 2011
In this week’s episode:

What is the outlook for dividends? David finds out when he chats with Todd Wenning, the lead analyst of Dividend Edge, our high-yield share recommendation service. They look at the benefits of dividend investing and how investors can avoid the most common pitfalls. A transcript of this podcast is also available.

 

Special dividend video

View our specially commissioned video --  In this short video, we reveal one the secrets which some of the world's richest and most successful people have used to create their awesome wealth. People like Warren Buffett, Jim Slater and Anthony Bolton -- CLICK HERE TO WATCH THIS VIDEO NOW!

David and Todd meet a fan
David and Todd meet a fan

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Comments

The opinions expressed here are those of the individual writers and are not representative of The Motley Fool. If you spot any comments that are unsuitable hit the flag to alert our moderators.

gloxinia 08 Mar 2011 , 5:43pm

I live in Germany.
Am I eligible to join this scheme?

gloxinia 08 Mar 2011 , 5:59pm

Todd Wenning looks like a guy you'd meet at a weekend rave party. Is he really an investment analyst?

XMFPhila100 09 Mar 2011 , 8:14am

Hi gloxina,

Todd Wenning looks like a guy you'd meet at a weekend rave party. Is he really an investment analyst?

I'm the one on the left. :)

I had a little chuckle over this comment -- provided a good start to my day -- as I'm probably the last person you'd catch at a rave party.

I live in Germany.
Am I eligible to join this scheme?

We primarily invest in U.K.-based and LSE-listed dividend paying shares. If you think that might benefit your portfolio, it's something to consider.

Foolish best,

Todd Wenning

gloxinia 10 Mar 2011 , 6:13pm

Todd, OK we won`t meet at a rave.
I am very interested in dividend investing, but the conditions to join state I must be a British resident.. Is there a way to join dividend investing whilst resident in Germany. At the moment I`m stuck in German bank growth fonds. Recent Foolish articles have opened my eyes.

XMFPhila100 11 Mar 2011 , 10:22am

Hi gloxinia,

It shouldn't be a problem to join and not be a British resident -- we have members from all over the world.

You might not be able to join our Share Dealing service as it requires you to have a National Insurance (NI) number. Dividend Edge is a separate service.

Foolish best,

Todd Wenning

gloxinia 11 Mar 2011 , 11:51am

Hi Todd,

So Dividend Edge is a separate service.

But to deal shares, it sounds as if I`m going to need a broker.
Can you point me in the right direction. Can you access my email?

Lets get this going. Germans are a stodgy lot when it comes to savings. Just do what their bank tells them. We need a MF Germany.

XMFPhila100 11 Mar 2011 , 4:09pm

Hi gloxinia,

Hmm...I'm not sure about the capacity of German brokers to buy UK shares on the LSE.

It might be a question best asked of the Fools on the "International - Expat Investors" board: http://boards.fool.co.uk/international-expat-investors-50919.aspx

They might be able to steer you in the right direction.

Foolish best,

Todd Wenning

RiverCactusMario 12 Mar 2011 , 12:13pm

Hi gloxinia

I live in Germany.

I have the fortunate position of having opened broker accounts in the UK before I moved here, and of earning most of my income in pounds. (Fortunate in terms of ease/cost of buying UK shares, not in terms of the diminishing value of pounds!)

However, German brokers will let you trade overseas. Just for example there is the DAB Depot: http://www.dab-bank.de/hilfe-service/faq/weltboersen.html.

As you see, with this broker it costs an extra €24 per trade when buying overseas shares, plus it will no doubt take an extra slice off the exchange rate when it converts your euros to pounds. It's worth comparing costs at a few brokers. You may even want a separate broker for UK purchases, as the cheapest for those deals will probably be different to the cheapest broker for purchasing domestic shares.

I'm sure it'll always cost you a few percentage points more to buy overseas shares though, and those costs can really eat into your returns. Don't underestimate how much those costs can whittle down your long-term performance if you rapidly buy and sell overseas shares for quick gains (especially with the flat 25% capital gains tax we pay here in Germany). Not to mention the random element that short-term currency fluctuations throw into the game.

However, there are only so many wonderful businesses in the world, so if you see one in the UK or elsewhere that you think is worth holding on to for a long time (and therefore not continually paying trading costs and taxes by turning over your portfolio) you should not feel limited to buying shares just in Germany.

Reliable dividend-paying companies with unbeatable competitive advantages are the sorts of businesses that can be worth paying higher costs for, but choose just the very best and hold on to them.

Neil

RiverCactusMario 12 Mar 2011 , 12:50pm

P.S. David and Todd, that doll will give me nightmares.

gloxinia 26 Mar 2011 , 10:11pm

Thanks RiverCactus.
You have useful information.

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MoneyTalk is a podcast from The Motley Fool UK. Hosted by Owain Bennallack, it's a lively roundtable discussion in which Fool writers and guests from the world of money thrash out the financial issues of the day.

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