sharegardener
08 Jan 2018
Re: Quarterly Dividends Thanks for your comments Dutchman & Marktime!I tend to look at total return and usually hold for several years but prefer shares with reasonable income within my ISA to benefit from income tax relief and no/low income outside of ISA to utilise some CGT allowance (though CGT isnt a major concern for my trade sizes!)I think IBT is also topslicing capital to distribute as income with a 4% yield.Europe overall looks fairly resilient for medium to long term growth but £/Euro determines what we get and I dont have time or expertise to delve around individual companies across europe so pooled investments best imho. FP Crux european special situations looks like a good performing unit trust but in general I stay away from UTs.Im looking at where to put next years ISA allocation from April '18 as well as the trickle of dividends which build up over time.Good luck all!SG
deepsleeves
08 Jan 2018
Re: Quarterly Dividends MarktimeHave a look at MCT for a 5%+ dividend with North America exposure - another way to diversify and with quarterly dividends if income is your thingDeep
marktime1231
06 Jan 2018
Re: Quarterly Dividends TRG is a pure growth trust, backing a diverse spread of companies. It is something I have been considering adding to my long term SIPP for extra European exposure, TRG has pretty good recent performance history like it is on a roll, management is well regarded which is just as well given the size of the charges and because you can't really second guess their stock picks, and just on a small discount still. It features in the portfolio of many contributors to this site, which goes to show it does not hurt to have the words European and Growth in the title. You could buy it and forget it for 10 years and expect to come back to two or three times the value.EAT is an especially high income trust concentrated on fewer stocks, where some growth momentum is converted to distributable cash to augment natural yield. Critics say that approach risks diluting the core holding, the opposite of compounding, but when NAV has been progressing 26% pa then paying out 6% of NAV in divis is hardly a problem. Rather than sell underlying stocks, in a rising market cash is raised by issuing new EAT shares from treasury at the moment at a slight premium - which stops the sp from getting too far ahead of itself, but it hasn't dented overall progress much.I am a huge fan of EAT for its delivery of top class income along with strong growth at times, but it is sensitive and I have traded in and out over the years on sentiment. At the moment I am hoping for a steady continuation of NAV growth to go with the progressive income just announced, and expect a fairly stable GBP:EUR, so I added recently in my short term SIPP for its income delivery - you can retire on a progressive 6% natural yield and have the core to leave to the grandkids. Very very few actively managed diverse basket investments come close to offering that right now.I would say look at both right now, for completely different reasons, sorry I don't know much about the other options for European growth trusts and I don't think there is anything else quite like EAT in the world let alone Europe to compare with.
The Dutchman
05 Jan 2018
Re: Quarterly Dividends you shouldn't be swayed by the high divi here. It is simply the (current) policy of the board to pay a divi of 6% of NAV. Of course much off this divi is paid out of capital; the underlying shareholdings do not produce that sort of dividend income. You could achieve the same result yourself with any Investment trust by selling some of your holding each year to get a 6% annual yield. Having said that it is re-assuring to look at the overall level of income across all your holdings.
sharegardener
05 Jan 2018
Re: Quarterly Dividends Hi allIve also been holding some EAT for a while and like the regular dividends and non-UK exposure. I usually only add when at a discount to NAV. Currently just above par.Looking on the AIC website, the 4 european smaller co. ITs are EAT, JP Morgan, TR European Growth and Montanaro. All except EAT have low yield.JPM & TR rank the highest on NAV total return over 3, 5 & 10 years. Surprisingly EAT is 4/4 but a close 3rd on shareprice total return.Montanaro is on 13% discount currently, this looks disproportionate.I will do some digging around through all their reports. Does anyone hold any other european ITs?SG
devonplay
05 Jan 2018
Re: Quarterly Dividends 11% + Lovely. Not, you Don, the increase.It's been a good long term holding. DL
Windlesham Don
05 Jan 2018
Quarterly Dividends A comforting increase in dividend and a good idea to switch to quarterly payment. This looks like a good IT to tuck away for exposure to European Smaller Companies.
deepsleeves
03 Jan 2018
Re: Added today MarktimeHello again,Like you I added to these on 2nd - a further £5k worth in my SIPPKept my HGM in my isa though..Deep
marktime1231
03 Jan 2018
Added today I doubled up the EAT holding in one of my SIPPs this morning, we can look forward to a good dividend announcement this week and I expect steady progress in NAV during 2018 from the solid selection in EATs portfolio. The dividend might be diluted if GBP strengthens to EUR, but I don't envisage sharp movement - not while the UK holds down domestic interest rates to try and keep growth from faltering, consumer inflation is seen as transient and slow to drive up wages. But then I don't quite understand exchange rate movements, it feels like you need to look back 6 months to understand what happened and why. The US has in progress a conveyor of interest rate rises, but GBP:USD is heading back towards $1.40 against the tide ... er, how come?
My name is Bond James Bond
03 Jan 2018
Re: Dividend Tax The annual and interim results indicate how the dividend is calculated. They pay out a net 6% annually by reference to the end of year NAV in Euros. This is grossed up so that shareholders are not disadvantaged by Dutch witholding tax on those Dutch assets held. 3 distributions are made throughout the year with sterling conversions made based on the exchange rate at the time of distribution. For sterling holders this can imply a yield of greater than or lower than precisely 6% depending on exchange rate movements throughout the year. If sterling falls during the year you will receive more bang for your buck and vice versa.Regar
My name is Bond James Bond
03 Jan 2018
Re: Why not France? They do include France in their search for suitable investments and at the last set of results reported at least one French investment. The total holdings of French companies are relatively small however and are included in countries "other" for reporting purposes. Regar
budu
31 Dec 2017
Why not France? I've never considered this stock until now but how come France is excluded from its portfolio?
hanoiboy
12 Dec 2017
Re: Dividend Tax The calculation is a bit smoke and mirrors and I have never been able to get a definitive published methodology but you are broadly correct for 2017. The web site does say that the divi is engrossed to take account of witholding tax and you will see that the August payment in preceding years is indeed higher. Scroll down towards the bottom of[link] complicate matters for 2018, the Dutch have amended legislation in September 2017 to exempt witholding tax in certain circumstances. The actual wording says:======Exemption dividend withholding taxThe exemption for withholding dividend tax at source is broadened for qualifying interest in BV/NV and holding cooperatives (and other Dutch entities) if the parent companies is tax resident in the EU, EEA or a third country that has concluded a tax treaty with the Netherlands that contains "qualifying provisions" relating to dividend withholding tax. For this exemption it is required that the interest in the Dutch entity would have to be an investment that would qualify for the Dutch participation exemption or participation credit if the recipient were resident in the Netherlands. Also where a treaty provided for a reduction to for example a 5% dividend withholding tax rate, the full exemption of dividend withholding tax will apply under this broadened scope. =====It remains to be seen how EAT will take advantage of this exemption, if at all, but I intend to email the managers for their position if there is no reference in the declaration for 2018 due at the end of this month. I can find nothing on the trust's own web site.
Windlesham Don
12 Dec 2017
Re: Dividend Tax As it is getting towards the end of the year I'd like to clarify the dividend situation with this trust. The following is my educated guess from looking back over the literature:The trust will pay dividends at 6% of NAV quoted in Euros and calculated at the end of the year, equally paid out in three installments during the following year.However, this 6% figure is gross of Dutch tax (at around 4% by the look of it) which needs to be deducted, thus last year's 6% of NAV was EUR0.822, but the payment received was EUR0.7884 (3*EUR0.2628).Thus the 'true' net yield is around 5.75%pa, which will then fluctuate in sterling terms, as the exchange rate is calculated at the time of each dividend payment.Does anyone agree/disagree with this reasoning?
II Editor
20 Nov 2017
NEW ARTICLE: Three European investment trust tips "European shares are fast becoming a favourite among professional investors, as economic recovery gathers momentum and companies upgrade their earnings forecasts after years in the doldrums.Europe is currently wealth manager 7IM's highest ..."[link]
