US Dividends Aristocrats thread

[Mr. Wood]

Hi guys,

I understand that Singaporeans investing in US market are taxed 30% on our dividends.

Hence, I would like to ask what are some workarounds to this tax situation? I could only think of two - (1) buy leaps to stay vested over the long term or (2) stick to short term trades and sell before ex-dividend date.

Sorry if this is a newbie question and if I'm posting on the wrong thread...

Thanks!!

u want to buy shares or ETF? if ETF, follow basic strategy's suggestion use Irish domicile ETF.
shares, not dat i know any way to avoid the tax. i calculate my entry price taking into considering the 30% tax. eg if my desired DY is 3%, i will target EP at 4% DY.

another way maybe buy unit trusts with dividend distributions, not accumulation share class.

options dun pay dividend, so i dun really understand why u want to buy leaps. might as well buy the shares and collect dividends along the way. somemoar buy options got time decay, especially the last 30days.

short term trades might work, but u gotta monitor closely and take note if yr broker charges commissions.

 

[Mr. Wood]

Not true. WHO endorsed it.

https://www.abc.net.au/news/2021-01-14/covid-19-vaccine-efficacy-rates-explained/13042960

thanks for the article but i was referring to other vaccines like hepatitis, rubella.

 

[Mr. Wood]

Earnings Calendar


Monday, January 18, 2021
Carnival Corp (CCL)

Tuesday, January 19, 2021
Bank of America (BAC)
Netflix (NFLX)
Charles Schwab (SCHW)
Goldman Sachs (GS)
State Street (STT)
Halliburton (HAL)
Comerica (CMA)
Zions (ZION)

Wednesday, January 20, 2021
Procter&Gamble (PG)
UnitedHealth (UNH)
ASML ADR (ASML)
Morgan Stanley (MS)
U.S. Bancorp (USB)
Bank of NY Mellon (BK)
Kinder Morgan (KMI)
Discover (DFS)
Fastenal (FAST)
Citizens Financial Group Inc (CFG)
United Airlines Holdings (UAL)

Thursday, January 21, 2021
Intel (INTC)
IBM (IBM)
Intuitive Surgical (ISRG)
CSX (CSX)
Truist Financial Corp (TFC)
Match Group (MTCH)
Travelers (TRV)
PPG Industries (PPG)
SVB (SIVB)
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Fifth Third (FITB)
Northern Trust (NTRS)
M&T Bank (MTB)
KeyCorp (KEY)
Citrix Systems (CTXS)
Seagate (STX)
People’s United (PBCT)

Friday, January 22, 2021
Schlumberger (SLB)
Regions Financial (RF)
Huntington Bancshares (HBAN)

 

[Newbyib]

Hi guys,

I understand that Singaporeans investing in US market are taxed 30% on our dividends.

Hence, I would like to ask what are some workarounds to this tax situation? I could only think of two - (1) buy leaps to stay vested over the long term or (2) stick to short term trades and sell before ex-dividend date.

Sorry if this is a newbie question and if I'm posting on the wrong thread...

Thanks!!

1 workaround- a deep ITM covered call pre assignment which will be assigned on x dividend allowing you to capture the premium as dividend.

 

[rtxsohz]

u want to buy shares or ETF? if ETF, follow basic strategy's suggestion use Irish domicile ETF.
shares, not dat i know any way to avoid the tax. i calculate my entry price taking into considering the 30% tax. eg if my desired DY is 3%, i will target EP at 4% DY.

another way maybe buy unit trusts with dividend distributions, not accumulation share class.

options dun pay dividend, so i dun really understand why u want to buy leaps. might as well buy the shares and collect dividends along the way. somemoar buy options got time decay, especially the last 30days.

short term trades might work, but u gotta monitor closely and take note if yr broker charges commissions.

Thanks very much for the replies guys. To set the context, I want to buy shares (not ETFs), and the main issue I have with buying dividend yielding stocks is the 30% tax that will be charged.

Is the general consensus here to just incur the 30% tax? I wasn't too sure about this approach because from an efficiency standpoint, I thought the tax would be a drag on one's ROI. For example, if an SG investor were to buy a high dividend yielding stock like XOM (~6.9%), wouldn't he be foregoing a significant chunk of his returns? This was also why I had suggested LEAPs as a way to go long on a dividend yielding stock, since options don't pay out dividends that will then be taxed on. As you have rightly mentioned, I suppose one mitigating measure is to price in the 30% tax and be more selective about entry points for dividend yielding stocks.

Happy to hear your views and learn where my understanding is lacking. Cheers!

 

[Mr. Wood]

https://drive.google.com/file/d/1_GMEwYjBRwFXQ7ol1cMwg-rCh9Eq0vSb/view

Sure Retirement
HIGH-YIELD, HIGH-QUALITY SECURITIES
January 2021 Edition
Published on January 10th, 2021

 

[Tp101s]

Somehow, I hold the view that it is just not worthwhile to invest in US market for purpose of dividend yield, esp if it is in the range of under 10%. The 30% withholding tax is really withholding me. This is even before factoring in transaction cost and possible exchange rates (for non-US currency holders).

 

[Mr. Wood]

Thanks very much for the replies guys. To set the context, I want to buy shares (not ETFs), and the main issue I have with buying dividend yielding stocks is the 30% tax that will be charged.

Is the general consensus here to just incur the 30% tax? I wasn't too sure about this approach because from an efficiency standpoint, I thought the tax would be a drag on one's ROI. For example, if an SG investor were to buy a high dividend yielding stock like XOM (~6.9%), wouldn't he be foregoing a significant chunk of his returns? This was also why I had suggested LEAPs as a way to go long on a dividend yielding stock, since options don't pay out dividends that will then be taxed on. As you have rightly mentioned, I suppose one mitigating measure is to price in the 30% tax and be more selective about entry points for dividend yielding stocks.

Happy to hear your views and learn where my understanding is lacking. Cheers!

yes, i am giving up 30% div in exchange for lower commissions (now is free comms).

dis was my thought process when i first started investing in US stocks: if not US, alternatively i can buy SG or HK shares which oso pays generous dividends but at a higher broker comms and other fees.

so yes, it will lower overall investment returns, but i was not too fixated on the 30% tax. i think of it as the 70% is real cash in pocket which allows me to spend however i want.

 

[Mr. Wood]

Guide to the Markets®
U.S. 1Q 2021 As of December 31, 2020 J.P.Morgan Asset Management

 

[Mr. Wood]

Biden plans 'roughly a dozen' Day One executive actions: aide
Jan 16, 2021

Most of the measures are a reversal of policies Trump pursued and do not require congressional action. But Biden will also unveil a long-expected immigration proposal that would provide a pathway to citizenship for millions of undocumented immigrants that does require congressional action.

That measure, as well as Biden’s recent proposal for $1.9 trillion in spending on COVID vaccinations and economic stimulus, face uphill battles in a Congress narrowly controlled by Biden’s fellow Democrats.

A broader set of Biden’s “Day One” promises will be executed over the following nine days after inauguration, Klain said. Those measures include expanding COVID-19 testing and directing the government to favor American-made goods when it makes purchases

 

[Mr. Wood]

Tks Bro Wood. Slide 20 is quite interesting.

np

if u hav any insights of wht JPM trying to say, pls share as well, i am still trying to read thru

 

[Mr. Wood]

Fauci says two more COVID-19 vaccines could be approved within ‘weeks’
Jan. 18, 2021

Dr. Anthony Fauci on Sunday that Johnson & Johnson and AstraZeneca could send studies of their COVID-19 vaccines to the feds for approval within “weeks.”

“And, they’re going to have to get their data and safety monitoring board to look at it to see if it is appropriate to start, you know, essentially putting the package together to get an emergency use authorization. But we’re weeks away, not months away, for sure.”

If the data shows the shots are safe and effective, the vaccines would be the third and fourth to seek emergency use authorization in the nation.

The FDA has already authorized shots from Pfizer, and Moderna, which have both been distributed across the US.

Only pfizer and moderna approved by FDA as of today,

 

[Mr. Wood]

5G Rivals Face an $81 Billion Tab After Spectrum Buying Spree
Jan. 17, 2021

Bidders spent a record $80.9 billion in a U.S. government airwaves-license sale, capping a frenzied auction that will demand a commensurate wave of borrowing in an already-indebted telecom sector.

gamen will alwys be the winner

 

[Mr. Wood]

FAANG Q4 earnings and beyond
January 20, 2021

However, a closer look at the FAANGs reveals that their share price rally has lost momentum and the stocks have more recently moved sideways, with some even slipping lower.

Not all FAANGs are equal
It is also worth noting divergences that are appearing with the FAANG group and this will be a key theme to watch across the coming year.

In 2020 Apple’s share price and Amazon’s share price both rallied around 80% across the year. Netflix around 70% and Facebook and Alphabet gained 30% under-performing the Nasdaq which rallied 43%.
These figures show that advertising tech – those which make the majority of revenue through advertising didn’t perform so well.

Looking ahead the continued fracturing of the FAANGs group is likely, with the most bullish forecasts reserved for Apple and Amazon, whilst optimism surrounding Facebook is fading.

 

[Mr. Wood]

Goldman Sachs Group Full Year and Fourth Quarter 2020 Earnings Results
January 19, 2021

Full Year
Net revenues were $44.56 billion for 2020, 22% higher than 2019, reflecting significantly higher net revenues in Global Markets and Investment Banking and higher net revenues in Consumer & Wealth Management, partially offset by lower net revenues in Asset Management.

Net revenues in Investment Banking were $9.42 billion for 2020, 24% higher than 2019, reflecting significantly higher net revenues in Underwriting. This increase was partially offset by significantly lower net revenues in Corporate lending and slightly lower net revenues in Financial advisory

Net revenues in Consumer & Wealth Management were $6.00 billion for 2020, 15% higher than 2019.
Net revenues in Wealth management were $4.78 billion, 10% higher than 2019,
primarily reflecting higher Management and other fees, primarily reflecting the impact
of higher average assets under supervision, higher transaction volumes and the impact of the full-year consolidation of GS Personal Financial Management, partially offset by a lower average effective management fee due to shifts in the mix of client assets and strategies.

will be comparing amdk with the local 3 banks and see who they measure against each other.

 

[Mr. Wood]

Hahahah Bro Wood, I think I did a lot of things when I was young so I have an opinion about this.

Share a bit.

GS is an investment bank. They do fee based business aka non balance sheet business. Think M&A, SnT, AM etc.

Local banks are doing balance sheet business. They collect deposits and lend out to borrowers. Local banks do fee based business but that's a small percentage compared to the deposits and loans.

Actually local bank of SG, M'sia, HK, KR and BKK can display very different characteristics.

Biz model and operating environment are different.

thks for sharing bro.
i thot at least DBS and OCBC moving more to fee based transactions. there was most growth in fees for DBS last yr iirc

actually i oso agree banks ard the region are diff in nature. not sure why analysts keep on comparing all the banks in the region using the same matrices

 

[Mr. Wood]

PepsiCo initiated with an Underperform at Bernstein
01/19/21

Bernstein analyst Callum Elliott initiated coverage of PepsiCo with an Underperform rating and $136 price target.

 

[Mr. Wood]

Clorox initiated with a Market Perform at Bernstein
01/19/21

Bernstein analyst Callum Elliott initiated coverage of Clorox with a Market Perform rating and $206 price target

 

[Mr. Wood]

P&G Announces Fiscal Year 2021 Second Quarter Results
1/20/2021

P&G raised its outlook for fiscal 2021 all-in sales growth from a range of three to four percent to a range of five to six percent versus the prior fiscal year. The Company raised its outlook for organic sales growth from a range of four to five percent to a range of five to six percent. Foreign exchange is now expected to be roughly neutral to sales growth for the fiscal year.

 

[Mr. Wood]

Mercedes-Benz Unveils Entry-Level EQA Electric SUV: What You Need to Know
January 21, 2021

The EQA 250 model has an output of 140 kWh and has a combined consumption of 15.7 kW/100km, and combined carbon dioxide emissions of 0g/km. Further power levels of more than 100 kWh as well as a variant with all-wheel drive are expected to follow.

The vehicle allows for preconditioning thermal management before starting via Mercedes-Benz user experience or the Mercedes me app.

The compact SUV, which is built in Rastatt in Germany and Beijing in China, will be made available at European Mercedes-Benz dealerships in the spring.

if mercedes wanna bring EV here, yall think the old forgey ministers will allow anot?