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Foreign Markets Offer Higher Dividend Yields

The current yield on the S&P 500 is just over 2%. Last year the yield was 2%. Many foreign markets offer higher dividend yields than the U.S. This is especially true with most developed countries.

In 1979, the S&P 500 had a 5.53% yield. But since 1990, it has steadily decreased  and reached a low of 1.89% in 2007. In 2008, the yield rose to 3.11%. The current yield of just over 2% is very low. This is because many U.S. companies believe in reinvestment or retained capital as opposed to paying out a higher portion of profits to investors as dividends. In November last year, the Journal reported that the 500 largest non-financial companies by assets in the U.S. had stashed about $994 billion in cash and short-term investments.

The chart below shows the current dividend among G-7 countries:

Current-Dividend-yield-G7-Countries

Source: Pensions & Investments

Except Japan, all other countries have higher yields than the US. European companies traditionally have had higher payout ratios and continue to follow that policy.

The following 13 Foreign Stocks have Dividend Yields of Over 5%:

S.No. Company Ticker Country Dividend Yield as of March 12, 2010
1 Eni Spa E Italy 5.74%
2 Ecopetrol EC Colombia 5.33%
3 National Australia Bank Ltd NABZY Australia 5.28%
4 Banco De Chile BCH Chile 6.06%
5 Deutsche Telecome DT Germany 7.65%
6 AstraZeneca Plc AZN U.K. 7.71%
7 Grupo Aeroportuario del Sureste SA ASR Mexico 8.42%
8 CorpBanca BCA Chile 8.42%
9 BP Plc BP U.K. 5.91%
10 CPFL Energia CPL Brazil 6.37%
11 France Telecom FTE France 6.94%
12 Reed Elsevier NV ENL The Netherlands 6.78%
13 GlaxoSmithKline PLC GSK U.K. 6.07%

More on this topic (What's this?)
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Well I'll Be Damned...The S&P Hits a 17 Month High(!)
Read more on Dividend Yield, S&P 500 (SPX) at Wikinvest

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