It’s been about two years since I first invested in Australian issues, choosing to take a slow approach while I obtained some practical experience first hand. Certainly many of the yields are good, but the economy – much like Canada – is resource based. Then there’s the whole franking deal. Plus the foreign exchange conversion – but this has been relatively stable at 75 – 80 cents per USD. Add to that, until recently the selection was limited to ADRs or using a cost prohibitive foreign desk.
Last month I introduced the Rolling Unabridged Monthly Portfolio (RUMP). The primary reason was to attempt to identify Herd Mentality tendencies within the DGI community. My first assumption is that there may be a 6 to 9 month lag from identification to purchase. My database now carries an eight month lag which I expect to reduce a little further over the next month or two.
In my web wanderings, I encounter many disparate views on investing. Some I agree with, others I don’t. Then there are the few I can’t even wrap my head around. About a year ago, it appeared that sentiment had begun to shift. One post, The dark side of dividend income by Bite-Sized Income (now dormant) highlighted this change. In a nutshell he presented an argument that dividend investing (@ 4%) is not worth the time. A plausible scenario is presented but it is unlikely the majority of us could capitalize on it.