Interestingly enough, many in the finance industry arent avid stock pickers nor online stock discussion participants
Yes, so which do you think has a bigger impact on total wealth? The front side commissions and, in particular, lost yield (due to time out of market) that you pay over the course of decades of accumulation with a distributing fund, or the deferred commissions (that you'll pay to some degree anyway since the dividend distribution is rather unlikely to be sufficient) during the couple decades of draw down of an accumulating fund? I think in any fair, reasonable calculation the accumulating fund will win this comparison, but you're welcome to run your own simulation.
True, possibly because people in finance generally have fairly stringent pre-trade approval process and can't get in and out of trades as easily.
Don't have much unfortunately so I only spend a bit. But keeping a bit more to see if in a months time it's lower than deploy warchest again. Don't think we need to be too greedy just a bit more than usual DCA to take advantage is better than nothing.
I suspect Shiny Things and I -- who are generally on the same wavelength -- have in mind that, unfortunately, most people don't save doggedly and invest prudently every month for 30+ years. Unfortunately most people have lapses. For example, they lose a job (and in a recession when stock markets might be cheaper), suspend their buys for some months, and thus lose some long-term returns and wealth accumulation. Or maybe they just forget to log on and make their buy(s). An accumulating fund helps mitigate those hiccups to a certain extent.
No, if you are a Singapore resident who is not a resident of any other country, then there is no WHT for dividends of WQDV.
I have never been charged any tax for dividends of my VWRD, as you can see below. It says "Exempt From Withholding".
Taxation is a complex subject, especially when the asset is global, and domiciled in a country you are not a resident of. There are multiple layers of taxes. The fund manager may need to pay for WHT for US stocks (the 15%) and to other countries as well. Once the dividend land on your hands, it may be subject to further taxes depending on your residency. If you are a Singapore resident, then no tax on your dividend as I have shown above. I think the iShares rep misunderstood you as someone who resides in Ireland or Europe etc, where dividend or capital gain tax may apply.
Annual Report 2019 - https://www.ishares.com/uk/individu...port/ishares-ii-plc-2019-en-annual-report.pdf
Check page 64. iShares MSCI World Quality Dividend UCITS ETF (WQDV) had an income (I assume mostly dividends) of $1.654m, and fund manager paid taxes of $201k. That's about 12% of dividends they received. This ETF has about 54% of holdings in US stocks. Fund manager will pay 15% to US IRA, and similar/other taxes to other countries which may have higher, lower or no tax. iShares declares dividend after deducting this tax expenses. That's why I say the dividend is net of WHT.
Let's check a pure US ETF, shall we? Check page 63 - iShares MSCI USA Quality Dividend UCITS ETF (QDIV). Tax of $1.862m on $13.145m income = 14.17% which is very close to the 15% WHT payable to US IRA. I see that iShares participates in securities lending. That is probably the reason some of the income may not be taxable, and why we don't see a perfect 15% here.
If you want to better understand taxation matters, I refer you to iShares Prospectus - https://www.ishares.com/uk/individual/en/literature/prospectus/ishare-ii-plc-en-emea-prospectus.pdf page 134-145. That will clear up a lot of confusions.
Tax compliant U.S. persons don't have any dividend taxes withheld on U.S. securities. We pay U.S. dividend tax rates that are almost always substantially lower than 30% (sometimes as low as zero), and we pay somewhat in arrears (basically on a quarterly basis). Yes, it's a substantial advantage that my gross (pre-tax) dividends are automatically reinvested. I then pay cash a bit later to settle the tax.
looks like cant congratulate you today
was hoping to see the win
"Singaporeans" is not the correct term here. There are Singaporeans who are U.S. persons, and there are Singaporeans who live in tax jurisdictions that have a higher dividend tax rate than the U.S. dividend tax rate. These Singaporeans (and non-Singaporeans) also can enjoy some tax benefits with automatic dividend reinvesting.
