Soak up some SOCGEN !!

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The Societe Generale SPO stock of France has been battered in the past few months due to the credit crisis and more recently due to a huge loss incurred by the bank as a result of actions of a rogue trader named Jerome Kerviel.The bank officials took decisive action and closed up positions even as the market was melting down worldwide. The rogue trader had gambled about £60 Billions.

You can read more about this stunning story here from the Evening Standard in UK:

Face of ‘world’s biggest bank fraudster’

The Societe Generale ADR stock (called lovingly as SOCGEN) – SCGLY.pk has fallen over 50% from a 52 Week high of $43+ to $21+ now. This is an excellent opportunity to pick up Socgen at this sale price. Events such as this fraud will eventually go away and the bank will return to its previous glory as a top world class bank and a wonderful investment in a few months.

Investing in SocGen is a smart move due to many reasons.
Some of them are:

  • SocGen operates in 77 countries and has 120,000 employees
  • Société Générale dates back to 4 May 1864, date of the authorization decree signed by Napoleon III.
  • Is a leading financial institution in the Euro Zone and the world
  • Is a component stock of the CAC 40, DJ STOXX 50, DJ EURO STOXX 50, MSCI Europe, FTSE Eurotop, FTSE4GOOD & Dow Jones Sustainability Index World indexes.
  • Increased dividends for most of the past 10 years
  • Has a dividend Payout Ratio of over 40% for the past 5 years
  • Has an yield of about 4%
  • The ADR SCGLY.pk has been active since July,1993

Foreign Utility Funds – An Intro !!

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Foreign Utility Funds:

There are NO mutual funds that invest exclusively in foreign utilities.

However there are a few domestic utility mutual funds that have a high percentage of portfolio exposure to foreign utilities. So if you want to invest in utilities abroad, this may be an option.

The following are some of those mutual funds:

1.Eaton Vance Utilities/ Dividend Builder A (EVTMX) – Has plenty of foreign exposure. A few months ago had some 40% on foreign utilities.

2.MFS Utilities Fund/I (MMUFX) – Had some 31% of portfolio in foreign utilities

3.AllianceBern Utility Income Adv (AUIYX) – Has some exposure to foreign utilities

Other mutual funds for review:
4. Franklin Custodian Fds:Utilities Series/Adv – FRUAX
5. Jennison Utility Fund – PRUZX
6. FBR Gas Utility Index Fund – GASFX
7. ProFunds:Utilities Ultrasector/Inv – UTPIX
8. American Century Utilities Inv – BULIX

Another option is to invest via ETFs. There are two ETFs in the market that concentrate on utilities in other countries. They are :

1. iShares S&P; Global Utilities Index Fund – JXI
This utility ETF has an asset base of $175 M and an yield of 9.27%. The expense ratio is 0.48%. Portfolio has some 68 stocks and the German utility giant EON AG is the largest holding.

The ETF has US utilities as well.Last year the fund returned just over 22% and the 5 year average annual return is over 26%.

More info. on this ETF can be found here:
http://www.ishares.com/product_info/fund/returns/JXI.htm

This ETF is a STRONG BUY now.The ETF has fallen from over $72 to the current price of $62+.

2. WisdomTree International Utilities Sector Fund – DBU
This one has assets of over $32 M. The big European countries of Spain,France, Germany, Italy and UK form the majority in the portfolio.

Links:

A list of such stocks can be found here:
https://www.topforeignstocks.com/Hi-Yield-Portfolio-Utilities.htm

The above site has Canadian utility stocks listed in NYSE, ADRs of European Utilities, Brazilian utilities etc.

Stealth ADR stocks !!

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There are some ADR stocks that are relatively unknown and they tend to fly under the radar. Investors who get in early at the right time reap huge rewards when everyone else is making average returns elsewhere. I call these stocks as “Stealth ADRs”. Below are some of these ADRs:

1. Nestle – SA – NSRGY.pk
2. Yara International – YARIY.pk
3. Adidas – ADDYY.pk

More later..

Best ADRs to pick up – Part I

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There are thousands of ADR stocks that trade in the US. For an investor that is venturing into the many foreign country stocks, this can be overwhelming.

Picture: Mount Everest view from the China side


Here are a few of the best ADRs that you can accumulate for your portfolio:

1. Petrobras – Brazil – PBR
2. Nestle SA – Switzerland – NSRGY.pk
3. Royal Bank of Canada – RY
4. Banco Bradesco – Brazil – BBD
5. National Australia Bank – NABZY.pk

One Cheap ADR stock trading at a discount now:
1.Societe Generale – France – SCGLY.pk

Note: This post is for informational purposes only.Please do your own due diligence before making any investment decisions.