Monthly Commentary 1 st September 2016

Transcription

1 Mnthly Cmmentary 1 st September 2016 August was by and large a flat mnth in the markets. Equity markets were slightly up, bnd markets slightly dwn, il strnger, and gld weaker. August was a quiet mnth with lw trading vlumes and nt much market-mving news ther than the usual will she / wn t she as investrs re fixated n Janet Yellen fr any hints f any mvements in shrt term US rates. Belw are tw unrelated tpics that yu might find f interest. The first is n dividend yields and the secnd n scaremngering. On Dividends In the cynical wrld we live in, bservers f financial markets are ften very sceptical f cmpanies financial statements, as many techniques are used t ften hide the true picture. But while sales, csts and incme figures may always be disputed, dividends are quite transparent as they are actually paid ut. Did yu knw that n average S&P 500 cmpanies returning cash t sharehlders ffer investrs a ttal yield f mre than 5%? This includes dividends and share buybacks. When cmpared t the dearth f yield available frm fixed incme, ne can see why lng term investrs pt fr the high - yet incnsistent and nt-guaranteed - ttal yield n ffer frm equities. On the next page is a chart curtesy f Citi that shws the difference between dividend yields and benchmark gvernment bnd yields in varius markets. 1

2 Other ntewrthy dds and ends n dividends: Glbal dividends in Q were $421.6 billin and n track t reach $1.16 trillin in All regins saw dividend grwth except fr Emerging Markets that saw a dramatic decrease f mre than 25% frm Q2-15. Technlgy cmpanies had the highest rate f grwth in dividends while financials maintain their lead as the highest abslute dividend payers glbally. France is the highest dividend-paying cuntry in mainland Eurpe, fllwed by Switzerland and Germany. Nestle tps the list f the biggest dividend payer glbally in Q2, fllwed by Sanfi, HSBC, Daimler and Allianz. Walmart at 11th spt glbally was the highest amng US crpratins, fllwed by Apple and Exxn Mbil at 14th and 15th respectively. 2

3 Elgin s Incme Prtflis With interest rates at all-time lws, the search fr yield is ever-increasing and ne needs t be very careful nt t fall int traps that lk t gd t be true. Fr thse f yu wh are nt aware f them, at Elgin we have develped incme prtflis. They have the fllwing attributes: Invested in listed and liquid securities including REITs (Real Estate Investment Trusts), High-Dividend ETF s and Equities, Listed Infrastructure Cmpanies, Clsed-End Funds and Investment Trusts that invest in equities and/r fixed incme and/r preferred shares and/r senir lans. Fcus is n quality f the securities and sustainability f the payut rather than thse that ffer the highest yields. Current yields are almst 4% annually. Prspect f capital gains t add t the ttal annual returns. Equity-like vlatility grwth risk prfile. Fr thse with a 5yr+ investment hrizn. Available fr USD and GBP investrs. EUR incme prtflis t be intrduced later this year. Available thrugh Interactive Brkers accunts - and thus very cst-effective. Minimum entry level f USD/GBP 25K fr IB prtflis. Minimum entry level f USD 500K r equivalent fr ther custdians. If yu are interested in finding ut mre infrmatin, please cntact yur Elgin advisr r send an t incme@elginadmin.cm 3

4 On Sensatinal Predictins With s much news being generated every secnd, ne has t cmpete heavily in rder t be nticed. The mre shcking/utrageus the stry, the mre likely it will have its ne minute f fame. Almst every week we get a few s frm clients wh have read smewhere that markets will cllapse, and belw in italics is the latest iteratin (we have nly included part f the ): Ecnmist Warns: "These 5 Charts Prve Stcks Will Crash" Our elected fficials just triggered an unstppable ecnmic crisis... "A 50% stck market wipeut, a 40% real estate cllapse, and a 300% rise in unemplyment will strike...very sn" That's why I've urged all f my subscribers t watch this cntrversial vide, and I encurage yu t d the same. S why shuld yu heed my warning? Well, I'm the lne ecnmist wh predicted the fall f the Sviet Unin, the stck market crash f 2000 and 2008, as well as the real estate bubble that hit in Because f my accurate predictins, I have been invited t shake the hands and cunsel the likes f frmer presidents Rnald Reagan and Bill Clintn, and I've been a cnfidante t sme f the mst influential peple in the wrld, peple like the Rckefellers, the Clintns, Bris Yeltsin and Dnald Trump, t name a few. Nw, I cnfess... 4

5 Many n Wall Street dismissed my bld claims at first. But after seeing the evidence And I knw the public needs t hear the truth frm a real ecnmist, an authentic persn wh deeply cares fr his cuntry James Dale Davidsn, Ecnmist and Authr Mr. Davidsn calls himself a real ecnmist. Accrding t Wikipedia he des nt have a frmal degree in ecnmics. Oh well, judge fr yurself abut the merits f such predictins befre selling ut. The Elgin Analyst Team Disclaimer The infrmatin in this article shuld neither be regarded as an ffer nr a slicitatin t buy, sell r therwise deal with any investment referred t herein. As a regular rule, the value f any investment may rise r fall. Past perfrmance is nt an indicative f future results. D nt take unnecessary risk and always request advice frm an investment prfessinal befre undertaking any investment. 5