• Home
• About Us
• Contact Us
• FactSheets
• Foreign ADRs List
• Indices
• Stock Lists

Australia

Australian Stocks with the Highest Dividend Yields

The Australian Financial Review Smart Investor published the list of stocks with the highest dividend yields among the largest companies on the Australian Stock Exchange.

From the article titled Downunder Dogs:

“Flea-bitten may be a bit harsh for some of these stocks but they are nevertheless this month’s Downunder Dogs – the stocks with the highest dividend yields among the largest 50 companies on the Australian Stock Exchange.

So what qualifies them as dogs? If you make the rather simplistic assumption that dividend levels remain more or less stable, then the dividend yield should rise as the share price falls. So by buying companies with high dividend yields you are buying shares that are out of favour – hence, “dogs”. And why would you want to buy a dog? The theory – based on the US stock-picking system known as the Dogs of the Dow – is that this year’s dogs often turn out to be next year’s prize pooches. Do you own these puppies?”

Source: Australian Financial Review

Ten Reasons to Invest in Australia

Australia is a developed country with a population of about 22 million. The country is rich in many natural resources and is ranked highly in many global comparisons of factors such as quality of life, healthcare, education, etc. Australia is similar to Canada in that both the countries have parliamentary democracy and are commodity-based economies.  Australia, known as the “The Lucky Country”, offers many advantages as an investment destination.

The following are some of the reasons to invest in Australia:

1. Australia is one of the few OECD countries to successfully weather the global financial crisis and it was the first G20 country to tighten the monetary policy by raising the key interest rate last October.
2. The country enjoyed consecutive economic growth for 17 years from 1992 to 2008 and is best positioned to participate in the growth of Asian markets of India and China due to its close proximity and natural resources.
3. The fiscal position is relatively strong and the current account averages just 4.5% of the GDP.
4. Many of Australia’s major export markets are in the vibrant and growing Asia including the countries of China, Japan, India, South Korea making it less dependent on the US and European countries.
5. Australian companies generally have higher dividend yields than most US companies.
6. Some of the Australia’s large exports are coal, iron ore, wheat, alumina, etc. Australia is the largest exporter coal in the world and China is the largest consumer of Australian coal. On the services sector, education has become a major export with Australian universities attracting thousands of students from the emerging markets of Asia.
7. The unemployment rate as of January,2010 is just 5.4% which is much lesser than the OECD average.
8. Australia’s equity market has been the best performing market for the past 110 years since 1900 with a real return of 7.5% per year.
9. Australia has the political risk is the lowest in the region.
10. The regulatory environment is strong but business friendly. A recent IMF study confirmed that Australian banks remained sound during the global credit crisis.

How to Invest in Australia?

The simplest and easiest way to invest in Australia is via the iShares MSCI Australia Index ETF (EWA). The fund has an asset base of about $2.2B and contains most of the the large companies there. Another way is to go with the closed-end for Aberdeen Australia Equity Fund (IAF). The expense ratio is 1.73% and the fund has total assets of about $208M. A third alternative is to invest directly in Australian equities. Some of the ADRs available are National Australia Bank (OTC: NABZY), Westpac Banking (WBK), Australia and New Zealand Banking Ltd (OTC: ANZBY), BHP Billiton (BHP), etc. The complete list of Australian ADRs can be found here and here.

Top Commodity Exports of Australia

The top five commodity exports of Australia are: Iron Ore, Coal, Gold, Crude Oil and LNG. As a resource-rich country commodities form the major portion of Australian exports. China, India, Japan are some of the major export Asian markets for Australia. Japan is the major export market for Oil and Gas, Coal, Aluminum and Copper. China is the largest importer of Australian Iron Ore and UK is the largest market for Australian Gold.

Graph

Source: Australian Commodities, June quarter 09.2

The total value of all Australian commodity exports is forecast to be around A$160.5 billion in 2009-10, a fall of 18.1 %  in 2008-09. Out of this metals and energy exports are projected to account for A$124.4 billion.

More detailed information on Australian Commodities and Export Markets can be found by clicking  on Australian-Commodities-Report-June-2009

Australian ADR Stocks List !!

Australia offers many investment opportunities as it is strategically located near the growing economies of Asia such as China,Indonesia,Malaysia,etc. Like Canada, Australia is a commodity based economy since the country is blessed with many natural resources.

The following is a list of Australian ADR stocks:

Important Notes:

1.Stocks trading under $1 or highly speculative stocks are excluded from this list.

2.ADRs that are highly illiquid (not trading often) are also omitted.

3.Securities with 5 character tickers and ending with “Y” trade on the OTC market (Pink Sheets)