Knowledge is Power: Canada Disappointment, Global Stock Valuations, German FDI Edition

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Merry Christmas to all !

Some past articles from this site to review as you prepare for 2016:

  1. Duration of Stock Holding Periods Continue to Fall Globally
  2. 10 Reasons to Invest in Foreign Stocks
  3. Dividend Withholding Tax Rates By Country 2015
  4. The Complete List of Biotech Stocks Trading on NASDAQ
  5. The World’s Top 100 Non-Financial TNCs Ranked by Foreign Assets
  6. The Full List of Indian ADRs
  7. The Full List of Chinese ADRs
  8. The Full List of Russian ADRs
  9. The Full List of Brazilian ADRs

Tanybwlch Train Station, North Wales

Tanybwlch Train Station, North Wales, UK

Dutch Dividend Withholding Tax Rates For Tax Treaty Countries

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The Dutch dividend withholding tax rates for treaty countries for 2015 is listed in the table below:

Click to enlarge 

Dutch Dividend Withholding Taxes for treaty Countries-Page 1

Source: Invest in Holland

To check the tax rates for all countries click the above image to open the table in pdf format.

For US residents Holland charges 15% in taxes on dividends paid out by Dutch companies.

Download: Dutch Dividend Withholding Tax Rates For Tax Treaty Countries 2015 (pdf)

Japan Dividend Withholding Tax Rates For Tax Treaty Countries

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The Japan dividend withholding tax rates for treaty countries for 2015 is listed in the table below:

Click to enlarge 

Japan Dividend Withholding Taxes for treaty Countries-Page 1

Source: Mizuho Bank

For the tax rates for all countries click the above image to download the table in pdf format.

How to use this table?

If you are Canadian resident and hold Japanese securities, Japan will withhold 15% taxes on dividends paid out by Japanese companies.For Chinese residents the rate is lower at 10%.

Download: Japan Dividend Withholding Tax Rates For Tax Treaty Countries 2015 (pdf)

Comparing Australian Dividend Yield and Payout Ratio To Other Countries

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Dividend yields and payout ratios vary across countries. In the developed world, most countries other than Japan and the US tend to have good dividend yields. In emerging markets, certain countries like Chile, Taiwan have high yields while places like South Korea, India, China, etc. have low yields.

The chart below shows the dividend yields by country as of September, 2015 based on MSCI indices:

Click to enlarge

Dividend Yields by Country 2015

Source: Investing in Retirement Using a Global Dividend Income Strategy, Thornburg Investment Management

Australian firms’ yields are nearly double that of the U.S. firms.

It is not just that the dividend yields are high in Australia. The payout ratio is also the highest in the world. The following chart shows the payout ratio of Australia and select developed countries:

Click to enlarge

Australian Dividend Payout Ratio Chart

Source: Alpha Beta Strategy and Economics via Australia’s dividend doom loop, Macro Business

Australia firms are now paying 63c  in every dollar earned to their shareholders in the form of dividends. This is up from 40c a decade ago.

Compared to other countries, Australian companies pay a higher share of their earnings to shareholders. For example, top British firms pay out just 50c in every dollar earned. U.S. firms listed on the NYSE pay out a pathetic 29c for every dollar.

The takeaway here for US income investors is that they should beyond the borders for better income stocks that simply sticking with American firms. As most US firms are not growing greatly and still continue to withhold more than three-fourths of every dollar in profits, it is wise to expand one’s horizons and invest in high-quality foreign stocks.

Currently 11 Australian companies are listed on the NYSE and more than 210 trade on the OTC market. In addition, many ETFs and mutual funds also provide access to the Australian equity market.