Dividends on Singapore equities

Share investors should have received their year-end statement of dividends on their share investments received in 2009.

 

Looking at my statement, total dividends came to $3,240. On investment cost of $101,000, this worked out to a simple average annual return of 3.2 per cent.

 

Majority of shares were kept for the whole of 2009, i.e. they were bought before 2009. The percentage return is based on investment values kept for the whole year. When comparing to fixed deposits placed with a bank for the whole year, it way surpassed the paltry 0.45 per cent per annum.

 

3.2 per cent income is decent considering the fact that 2009 was a recession year.

 

If we include capital appreciation of shares, the capital appreciation came to $4,285 as at 31 December 2009 (bulk of it is unrealised), the portfolio yielded 7.4 per cent.

 

The story here is that equity is an asset class that one can invest their spare cash. There is a need to pick shares that can deliver dividends and capital appreciation over time. We can still adopt the buy and hold strategy for some share counters with good fundamentals.

 

Written on 1/17/2010 11:26 AM

 

Copyright © 2010, the author known as LKT in Singapore.

 

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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