Dividends4Life: International Dividends

International Dividends

Posted by D4L | Monday, October 18, 2010 | | 0 comments »

Investors looking for higher dividend yields may want to turn their attention overseas as international stocks offer some of the best dividend values. Foreign firms have traditionally held a more dividend-friendly culture, paying them to shareholders rather than keeping them as retained earnings. This is evident in the higher yields of international firms. The S&P 500 SPDRs (NYSE:SPY) was recently yielding 1.91%, versus the iShares MSCI EAFE (NYSE:EFA) which is yielding 2.46%.

While the greenback has been on a tear lately, the expected long-term decline in the dollar is another reason why investors may want international dividends in their portfolio. As these dividends are paid in euros, loonies, krona and yen, and then translated into dollars, investors can receive a higher payout as the dollar falls. This allows investors to enter into a quasi "currency arbitrage" transaction. By selecting stocks of nations that have good long-term prospects, such as Canada, and are appreciating versus the greenback, investors can increase their dividends over the longer term.

Source: Investopedia

Related Articles:

________________________________________________________________

0 comments

Post a Comment

Note: Only a member of this blog may post a comment.

Dividend Growth Stocks News

~

Popular Posts Last 30 Days