Monthly Archives: November 2016

Purchasing Shares In Great US Companies – Cisco, Exxon Mobil, Intel, Nike and Procter & Gamble. 2

A couple of weeks ago, my online stock broker was offering free trades for stocks listed on the Dow Jones Index. As a frugal investor who is savvy with costs, I decided to dip my toe into the US market and buy an ownership stake in some of the best companies in the world. Although the Dow Jones has 30 great companies, I only bought shares in Coca Cola, Visa, Cisco, Exxon Mobil, Intel, Nike and Procter & Gamble. I feel that these are the only companies at present in the Dow that are trading at reasonable valuations. In this post, I concentrate on my purchases on the latter five […]

Capital Gains Tax Treatment of AB InBev (BUD) Takeover of SABMiler (SAB)

At the beginning of last month, the giant beer takeover of SABMiler by Anheuser-Busch InBev went ahead for £79 billion. For the investors of SABMiler, this takeover has provided a handsome pay-out. Each investor in SABMiler, depending on their preference received £45 for every share they owned or £4.6588 in cash and 0.483969 restricted shares. Whilst shareholders have received a premium of more than 50% as compared to the stock price the day before the takeover deal was announced, they are capital gains tax consequences for those investors who did not hold their shares in a tax shelter such as a Pension or ISA. Capital Gains Tax consequences of the […]

Foreign Investors Should Prefer Share Buybacks Over Dividends

The two main ways companies reward shareholders is via dividends or buybacks. There has long been a debate about which of the two is better. Both have there advantages and disadvantages and that is why many blue chip companies use a combination of the two. Buybacks Vs Dividends Dividends – When a company pays a dividend, it is essentially giving a share of its profits to its owners/shareholders. Dividends are usually paid at regular intervals and the best blue chip companies grow their dividend over time. Buybacks – A share buyback refers to the purchase by a company of its shares from the marketplace. As a result of a buyback […]

Coca Cola (KO) Stock Purchase – Keep It Simple When Investing 3

Keeping it simple. That’s how investing legend Warren Buffett became one of the world’s richest men. The oracle of Omaha built his fortune by buying businesses that are easy to understand. Today, his stock portfolio contains some of the best businesses in the world like Coca Cola, IBM and American Express. Meanwhile, he famously avoided Internet stocks during the 1990s dot-com bubble because he didn’t understand them. As an investor, you might be afraid of missing out or eager to jump on the latest fad stock. But keeping it simple is how Buffett made his fortune. Over the years, Buffet has made money by investing in the world’s best companies […]

Whitbread Stock Purchase (LON:WTB) – A Gauge For Global Prosperity

With a collection of hotels, restaurants and coffee chains under it is portfolio, it is easy to see why Whitbread is benefiting from the trend of increasing consumer prosperity. The theory is this, as people get richer, they want to indulge in products offered by the services industry. This means spending more money on travel (hotel accommodation) and eating out. Whitbread has been perfectly placed to capture this megatrend over the past few years and with an international pipeline that is only set to increase, the company is set to reap the rewards of increasing global prosperity. The natural fear for investors when investing in firms that capture the more […]

Vodafone Stock Purchase – Buy Shares In A Company Instead Of The Product

When I was growing up, I was fascinated by technology. I just loved gadgets and always wanted the shiny new thing. As I grew older and technology advanced greatly, my fascination only grew and I was caught up by the hype surrounding mobile phones. I remember that from the age of 17 to 22, I had a new smartphone every year. And we all know how expensive the latest versions of I-phones, Galaxy’s or HTC’s can be. Add the cost of a 12 month contract and all of a sudden having a new phone every year becomes an expensive habit. Whilst getting a new phone is fun and exciting, the […]

How Inflation Affects Everyday Life

In the financial news, inflation seems to be all the talk of late. The Bank of England has predicted that inflation will hit close to 3% next year and this is a dramatic change from the current deflationary environment. One of the key drivers in bringing inflation to the shores of Britain is the devaluation of the Pound (£). After the brexit vote, the pound has depreciated greatly against most other developed currencies. The devaluation of the Pound makes imports more expensive as you know have to pay more pounds for a given amount of a foreign currency. As imports in the form of products and raw materials rise, businesses […]

How Much To Save To Become Rich 2

We have all heard that paying yourself first is the best way to become wealthy in our society. Whilst we all know the merits about paying yourself first, many people do not now exactly how much money to set aside to pay themselves first. So is there a magic number? You hear people asking themselves this question all the time How much do I need to pay myself first? So here is my formula on how much you should pay yourself first. You don’y have to agree with it but just have a look at it. Whilst I know everybody is different and people have different circumstances, I am just […]

A.G. Barr (BAG) Stock Purchase – Are Drinks The New Tobacco? 1

Over the course of history, tobacco stocks have outperformed all others. British American Tobacco, Imperial Tobacco, Phillip Morris (Altria) and Reynolds America have all consistently produced double digit returns over the past 40 years. $10,000 invested in Altria (MO) over 40 years ago would be worth $2,191,990.07 today. Yes, that’s over $2million for a return of 21,819.90%. This is simply phenomenal and far greater than market returns. One of the big returns for Tobacco’s outperformance over the long-term has been regulation. Why the Sugar tax won’t hurt investors and profits To say the tobacco industry has gone through the mill in terms of regulation over the past few decades is […]

Should you worry about currencies when investing internationally?

It seems that many currencies have been extremely volatile this year, case in point the pound. Within the space of the past 12 month, it has traded in the range of 0.65 – 0.82 to the US dollar. This is a massive 26% trading range! Whilst a wide trading rage might be normal for currencies of developing economies, it is very rare for the best currencies. And the GBP is not alone. Safe haven currencies like the the Japanese Yen and Swiss Franc have all traded in a wide range against the dollar. Yes you may say that the dollar has been volatile as opposed to the rest but as […]