|
Post by Fletchsmile on Jul 6, 2015 13:18:53 GMT 7
I'm looking for any investments trusts that anyone has held for a while and is happy with and would suggest a look at. Simple criteria: > pay a decent yield - minimum of 3%, 4% or more would be nice. > could be global equities, UK equities or mixed including fixed income or any other asset class really > long term holds - doesn't need to be conservative - happy to take risk Any suggestions? (plus tickers/ BBerg codes/links if possible ) As context: We received a letter from our broker in Singapore that even though we have W8-BEN s in place, from 1 July they will no longer be catering to us (as non-US residents in Thailand) in terms of the tax treaty on any US stocks we hold. So the witholding tax rate on divs will switch from 15% to the standard default 30%. The US just seems to get more and more of a hassle to deal with these days, so I thought this is a decent time to just sell off any individual US stocks, and look elsewhere. As one of my objectives this year was to simplify our investments, I thought I might as well sell our individual UK stocks held via Singapore too at the same time. This will leave us with some XS funds in Singapore. Investment trusts would be a low cost option, with less work/admin than individual shares, that we can buy in joint names in Singapore (outside Thailand and UK). So hopefully we can pick a few decent funds, collect the divs and maybe over time see some capital growth. Cheers Fletch
|
|
|
Post by rgs2001uk on Jul 6, 2015 13:51:05 GMT 7
FS, heres the ones I hold, this is posted for your information only and should not be considered as a recommendation. You like me are old and ugly enough to do your own research, Alliance. Bankers. Brunner. Caledonia. Henderson Far East Income. JP Morgan Global Em Markets. Law Debenture. Monks. Scottish Mortgage. Templeton Em Markets. Witan. Witan Pacific.
|
|
|
Post by Fletchsmile on Jul 6, 2015 17:43:48 GMT 7
Cheers rgs. Always useful to have a good starting point. Can save a lot of time
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jul 7, 2015 5:28:26 GMT 7
You've mentioned elsewhere that you are loathe to buy at a premium to NAV, so I suggest you have a look at the following: BlackRock World Mining [BRWM] 7.44% yield. Middlefield Canadian [MCT] 5.45% The Merchants Trust [MRCH] 5.15% Murray Income Trust [MUT] 4.43% London & St. Lawrence [LSLI] 3.99% I like Henderson Diversified Income [HDIV] 5.71%, but it's trading at a slight (2.03%) premium to NAV. Also trading at a premium is City Merchants High Yield [CMHY] - premium 0.94%, yield 5.38%. Middlefield might be interesting, because it's North America, replacing your US holdings. Not really sure how the US and Canadian markets correlate, though. Best bet for a single stop solution would be London & St. Lawrence in my opinion. Or perhaps split between that and HDIV. (L & St. L also run unit trusts which are not particularly well known but have performed well, for example www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?id=F000001GDX .)
|
|
|
Post by Fletchsmile on Jul 7, 2015 13:38:15 GMT 7
Thanks AyG. If you've any decent ITs that are at slight premiums I'd also be interested, to be just wait and monitor. It has to be investment trusts rather than unit trusts, as they'll be in joint names. We can't buy unit trusts online in joint names thru our Singapore provider, as their systems can't cope with the joint names aspect on unit trusts! (Shares, ITs and ETFs are all Ok as exchange traded just not unit trusts). Any unit trusts in joint names for Singapore we have to send faxes to buy and sell, so we're trying to phase those out and simplify life
|
|
buddahas
Crazy Mango
Posts: 274
Likes: 176
|
Post by buddahas on Jul 7, 2015 13:56:00 GMT 7
I was under the impression that investment trusts are a bit dangerous. Are these simply stocks that pay a higher dividend yield?
|
|
|
Post by rgs2001uk on Jul 7, 2015 14:19:49 GMT 7
Americans refer to them as Mutual Funds, ITs are just a collection of stocks.
It depends on the type of IT you choose.
Be aware the price can rise and fall as with all types of investment.
FS will explain better than I can.
I dont consider ITs to be any more dangerous than investing in regular Blue Chip shares.
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jul 7, 2015 14:42:05 GMT 7
I was under the impression that investment trusts are a bit dangerous. Are these simply stocks that pay a higher dividend yield? I think you're misinformed. In the UK investment trusts are legally companies which trade on the London Stock Exchange, and the companies' businesses are investing in other companies. They're similar to unit trusts, except whilst unit trusts add to their investments when new money flows in, and sell them when money flows out, investment trusts have a fixed size. (That's not strictly true, but will do for a first level explanation.) They can be more risky than equivalent unit trusts because (a) they can use leverage (i.e. borrow money to make additional investments), whilst unit trusts can't, and (b) whilst unit trust prices are dictated by the value of the underlying investments, investment trust prices are dictated by what people will pay on the stock exchange. If lots of people want to buy an investment trust then the price will be higher than the actual value of the investments (known as "trading at a premium to net asset value (NAV)"). Conversely (and this is the usual situation), the price is below the value of the underlying investments (trading at a discount to NAV), so in fact you can be getting more investment than you're actually paying. In other countries these are known as "closed ended mutual funds".
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jul 7, 2015 14:58:14 GMT 7
Thanks AyG. If you've any decent ITs that are at slight premiums I'd also be interested, to be just wait and monitor. It has to be investment trusts rather than unit trusts, as they'll be in joint names. We can't buy unit trusts online in joint names thru our Singapore provider, as their systems can't cope with the joint names aspect on unit trusts! (Shares, ITs and ETFs are all Ok as exchange traded just not unit trusts). Any unit trusts in joint names for Singapore we have to send faxes to buy and sell, so we're trying to phase those out and simplify life The ITs with a decent yield and are at a slight premium that immediately spring to mind are: Invesco Perpetual Enhanced income [IPE] Henderson Far East Income [HFEL] European Assets [EAT] Aberdeen Asian Income [AAIF] Schroder Oriental Income [SOI] Troy Income & Growth [TIGT] (the yield is only 3.29%, but the lead manager has a great track record) I don't personally own any of these at the moment. (High income isn't a priority for me.) Used to own SOI but sold out of it a few years ago - a decision I now regret.
|
|
|
Post by Fletchsmile on Jul 7, 2015 19:08:41 GMT 7
I was under the impression that investment trusts are a bit dangerous. Are these simply stocks that pay a higher dividend yield? I guess it depends on what you consider as dangerous. Different people have different views. Basically, you could buy individual shares. Whether you consider that dangerous or not is a matter of perspective. What investment trusts do is pool together money from different investors into a "collective investment". They then use this money to buy a portfolio of shares (or other investments). So they are effectively a collection of shares pooled together and owned by a group of investors, rather than you buying on your own. So if you have 100 pounds you could buy 100 pounds of company A shares. With an investment trust, say 50 people invest 100 each, for a total of 5,000 pounds at the start. They could then go out and buy 100 pounds of 50 companies with that 5,000. As a fund holder you then have a 1/50th of a share in 50 different companies instead of just one company. This effectively spreads risk for you and makes it less dangerous, so you're not putting all your eggs in one basket or betting on a single company's shares and instead have a smaller share of more companies Investment trusts are basically companies set up to invest in other companies. They are traded like any other shares on a stock exchange, and their business is simply to invest in other companies. They're actually less dangerous than buying shares yourself in many ways (particularly if someone is new to investing), as two key advantages are 1) you spread your money out (diversify) 2) they are run by a professional investment manager who likely has a better knowledge of investing than someone starting off alone. In return for the investing expertise a small fee of say 1% of the assets in the investment trusts is charged over the year Cheers Fletch
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jul 8, 2015 7:43:40 GMT 7
|
|
GavinK
Crazy Mango
Posts: 101
Likes: 55
|
Post by GavinK on Jul 8, 2015 11:55:24 GMT 7
What's the UK tax situation on dividends paid from Investment Trusts bought via an offshore broker by a non-uk resident ? Paid net with tax credit non-recoverable ? Thanks.
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jul 8, 2015 14:24:11 GMT 7
What's the UK tax situation on dividends paid from Investment Trusts bought via an offshore broker by a non-uk resident ? Paid net with tax credit non-recoverable ? Thanks. Yup. Net with non-recoverable tax credit - but that's exactly the same wherever the broker, and whether you're UK resident or not. The only slight benefit if you're non-resident is that there's no additional income tax to pay if you're a higher rate tax payer. But that would also be the case if you were non-resident using a UK broker.
|
|
|
Post by Fletchsmile on Jul 8, 2015 14:49:29 GMT 7
What's the UK tax situation on dividends paid from Investment Trusts bought via an offshore broker by a non-uk resident ? Paid net with tax credit non-recoverable ? Thanks. Yup. Net with non-recoverable tax credit - but that's exactly the same wherever the broker, and whether you're UK resident or not. The only slight benefit if you're non-resident is that there's no additional income tax to pay if you're a higher rate tax payer. But that would also be the case if you were non-resident using a UK broker. Do you know if that also applies to UK ITs held via Singapore holding corporate bonds? As you say for equities, it's nice and easy, receive the div net, no admin or paperwork, and you can't reclaim the tax credit. Also same for my investments held in UK whether in normal account ISA or Pension can't reclaim the tax credit on equity investments . For any corporate bond funds I hold in the UK within my old ISAs though, Hargreaves Lansdown do claim back the tax credit on my behalf - one of the few exceptions still left from times gone by. Not on equities. Not on gilts, just corp bonds.
|
|
AyG
Crazy Mango Extraordinaire
Posts: 5,871
Likes: 4,555
|
Post by AyG on Jul 8, 2015 15:21:28 GMT 7
Yup. Net with non-recoverable tax credit - but that's exactly the same wherever the broker, and whether you're UK resident or not. The only slight benefit if you're non-resident is that there's no additional income tax to pay if you're a higher rate tax payer. But that would also be the case if you were non-resident using a UK broker. Do you know if that also applies to UK ITs held via Singapore holding corporate bonds? As you say for equities, it's nice and easy, receive the div net, no admin or paperwork, and you can't reclaim the tax credit. Also same for my investments held in UK whether in normal account ISA or Pension can't reclaim the tax credit on equity investments . For any corporate bond funds I hold in the UK within my old ISAs though, Hargreaves Lansdown do claim back the tax credit on my behalf - one of the few exceptions still left from times gone by. Not on equities. Not on gilts, just corp bonds. My understanding is as follows: Interest on Gilts is paid gross. No tax deducted to reclaim. Bond investment trusts are usually domiciled outside the UK in a country where they can pay out interest gross. For example, from memory, I think HDIV (Henderson Diversified Income) is domiciled in Dublin. Thus, where you hold them is irrelevant as a non-resident. Again, as non-resident no tax deducted to reclaim. Perhaps someone more au fait with such matters would care to confirm or condemn what I've written?
|
|