Tag Archives : investing explained

Best way to Teach Kids about Money, Business and Personal Finance Using Videos Made By Warren Buffet

Every responsible parent knows the importance of teaching their children about personal finance. If kids can learn about the importance of budgeting, how money can make even more money, the power of passive income and the power of compounded returns at a young age, they are sure to go through life on a steady financial grounding. The problem is most children are not interested in the finance related topics at a young age. They hardly like maths and english at school and I don’t think the subject of personal finance would be any different. The Best Way To Teach Your Children About Money – Secret Millionaires Club The best way […]

What Different Jobs Can Teach You About Investing

As investors, we often make the mistake of only concentrating our reading towards the fields of finance, business and economics. This is a huge mistake as it is more productive to read around one’s field than in one’s field. By learning about different fields of work, you increase your worldly wisdom as well as look at the bigger picture. With this in mind, these are some things you can learn from others professions. Biologist: All environments change, and the best protection against those changes is the ability to adapt. Gambler: Bet when others think the odds of success are low (that’s where there’s big payoffs) but be able to survive […]

The One Reason Why Property Returns More Than Stocks – Asset Classes 1

If you ask people in the UK the following question ‘ would you rather invest in property or stocks?’ I am sure the majority of people will give a resounding vote in favour of property. The reason is because the financial press is littered with stories of how everyday people in the UK have become millionaires via property. On the other hand, you hardly hear any stories about people becoming millionaires through ownership in companies via the stock market. This is rather interesting because if you look at the facts, stocks (equities) have historically outperformed all other asset classes returning 9.9% per annum whereas property only returned 5.7% per annum. […]

Which Royal Dutch Shell Shares To Buy To Avoid Paying Dividend Withholding Tax – RDSA Vs RDSB

There are a number of companies that are dual listed i.e. there stocks are traded in different countries. For the biggest companies, the price of the stock is usually the same on the two or more exchanges the stock is listed on. One might think that it does not really matter on which countries exchange you buy the stock. But as an individual investor, it is imperative you buy a stock you are after on the right exchange – by this I mean buying the stock in the country with a lower dividend withholding tax rate for instance. Let’s take Royal Dutch Shell for instance. It is a dual listed […]

3 Things To Look In Shareholder Letters

Most investors today tend to ignore annual reports. They are more content with analysing financial data from Morningstar or Stockflare than that in the raw form from annual reports. There is nothing wrong with this but it is important to remember that these fast financial data sites do not contain all the information found in an annual report. For one it doesn’t include any small print or strategy information. For another, it doesn’t contain shareholder letters. It is imperative for any serious to have a look at the shareholder letter of a company they want to invest in or are already invested in. These letters give a broad overview of […]

10 Different Types Of Competitive Advantage / Economic Moats To Look For To Outperform When Investing 8

When it comes to investing, most analysis is based on quantitive data. Investors look at things like the balance sheet strength, profitability figures and valuation ratios. Whilst the numbers of a business are key to figuring out its financial health and how it has historically performed; you need to look at its strategy to see where it is going in the future. You need to assess how the company makes its money to see if its profitability figures are viable going forward. You need to evaluate the quality of a business to see if it is worth investing in over the long term. In economics, mean reversion is the theory […]

How Do Equity Income and Accumulation Funds Work? Mutual Fund Investing

When it comes to investing in mutual funds or open ended investments companies (OEICS) as they are called in the UK there are many questions that spring to mind. What is the difference between income and accumulation units? how do I know how the fund will perform? Will a fund continue to earn the same returns the future as it did in the past? Hopefully, this post will aim to answer questions you have on mutual funds. Income Unit Funds Vs Accumulation Unit funds With equity income funds, you get the dividend paid to you. With accumulation funds, your dividends get automatically re-invested in said fund. Yes, you are able […]

Active Investing is Better Than Passive Investing In Overvalued Markets 2

Regularly readers of my blog will know that I recently moved some money out of a bunch of index funds and into my more actively managed portfolio. I can already here huge ‘sighs’ from the efficient market hypothesis faithful. Investors who religiously believe in index investing will tell you that it is impossible to beat an index fund over a considerable period of time. Whilst I agree with this statement, I also think that you need to use your brain at times and shouldn’t blindly follow any research. You need to be able to critically analyse the results of the research to see in what market environments the thesis or […]

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 […]

If you want to buy US listed shares, fill out a W-8BEN form (American stocks for foreign investors) 3

The rise of online platforms over the past decade has been great. From HL, to Youinvest, to interactive investor, these platforms allow individual investors like you and I to buy shares all over the world for a reasonable price. With this easy access to US, European and Asian stocks, many people forget to do research on how the system in these overseas countries works in a different way to ours. One example of this is Dividend Withholding Tax (DWT). If you buy shares in a foreign company, the dividend you receive from that company will be subject to DWT. This means that as a foreign investor, you do not get […]