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Yeild for Australian shares

Discussion in 'General Investing Discussion' started by Johny_come_lately, 26th Mar, 2010.

  1. Johny_come_lately

    Johny_come_lately Well-Known Member

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    Hi,

    For the last two years I have been getting about 0.725% for each quarter, on the ASX200. Does a bit under 3% p/a sound right for distributions?


    Thanks, Johny.
     
  2. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    Are you talking about the STW ETF ?

    According to the stats on their website, average distributions have been around 3.5% for the past year and 6%pa for the past 2 years.

    Yield is a tricky thing to measure for shares - since it relies on you choosing an appropriate price to measure it against. Yield on purchase price is all well and good, but if you bought at the bottom of the market, it will make your yields look better than they really are.

    I believe the industry standard for reporting yields is to use the price at the beginning of the financial year to calculate yield ... which again can be misleading, as it depends on what the price at that time was (and if you bought at a different time, your yield is somewhat different).
     
  3. Johny_come_lately

    Johny_come_lately Well-Known Member

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    What was the STW paying in 05 & 06?




    Johny.
     
  4. Vagon

    Vagon Well-Known Member

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    It would help if you confirmed what product you're specifically talking about, but if its the STW ETF then theroretically it should track the ASX 200 (XJO) minus a small consideration for fees.

    You can get the full performance on State Street's (fund manager) site.

    The distributions will also vary depending on the ETF manager but STW's are here.

    Cheers
     
  5. Vagon

    Vagon Well-Known Member

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  6. Johny_come_lately

    Johny_come_lately Well-Known Member

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    Looking at the State Street websight, I was supprised by the makeup of the ASX 200. 50% of the index is made up of 3 miners, 5 banks and 2 shopping centres. Not quite the diverse businesses I expected.



    Johny.
     
  7. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    Indeed - our market is extremely top-heavy.

    This is one of the reasons why theoretical diversification strategies will suggest you have a significant weighting to international markets - our is just too small. Of course, there are a whole heap of other issues that go along with international markets, so it's not just a simple allocation exercise - careful risk management is also required.