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How is the annual management charge collected?

WalterWalker1912
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How is the annual management charge collected?

#342786

Postby WalterWalker1912 » September 25th, 2020, 2:21 pm

I'm new to REITs (and this forum).

Could anyone tell me if the dividends are paid after the annual management charge has been deducted?

So, for instance, when I see a dividend yield on a REIT on Hargreaves Landsown's website, is that calculated after all management fees have been deducted? I would post the link, but LemonFool prevented me from doing so.

Thanks!

SalvorHardin
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Re: How is the annual management charge collected?

#342793

Postby SalvorHardin » September 25th, 2020, 2:39 pm

WalterWalker1912 wrote:I'm new to REITs (and this forum).

Could anyone tell me if the dividends are paid after the annual management charge has been deducted?

So, for instance, when I see a dividend yield on a REIT on Hargreaves Landsown's website, is that calculated after all management fees have been deducted? I would post the link, but LemonFool prevented me from doing so.

Welcome to TLF. The answer is yes; dividends on REITs are paid after charges are deducted. The quoted dividend is what you get after the charges have been taken from the REIT.

Many REITs don't have annual management charges. They are property companies which elected to be taxed as REITs some years ago. They don't have managers taking a separate fee. Examples of property companies which became REITs are British Land, Derwent London and Land Securities.

Some REITs are managed by investment managers (e.g. Schroder Real Estate Investment Trust). For these REITs the management charges are deducted before dividends are paid. Note that these charges are taken from the REITs assets, rather than separately from each investor.

jonesa1
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Re: How is the annual management charge collected?

#342796

Postby jonesa1 » September 25th, 2020, 2:44 pm

The quoted dividends for REITs and other ITs are what you get paid. The management charges and other costs, plus the dividends, are drawn from the asset pool (rental income, dividends, proceeds from asset sales). You can't rely on the yield quoted by HL as that is based on the last year's dividends, they may be lower (or higher) going forward. Working out the publicly stated plans for the dividend can take a bit of work (although Google makes it a lot easier) and they may be adjusted as circumstances change.

WalterWalker1912
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Re: How is the annual management charge collected?

#342946

Postby WalterWalker1912 » September 26th, 2020, 9:32 am

Thank you for those replies.

Where do you guys go for your fundamentals?

I used to subscribe to Stockopedia (which is excellent) but I don't use it enough to warrant their subscription fees. Before that, I would painstakingly trawl through annual reports with a calculator to hand. I'd rather not have to go back to that if there's free information available on the web.

dealtn
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Re: How is the annual management charge collected?

#342956

Postby dealtn » September 26th, 2020, 10:06 am

WalterWalker1912 wrote:
Where do you guys go for your fundamentals?

I used to subscribe to Stockopedia (which is excellent) but I don't use it enough to warrant their subscription fees. Before that, I would painstakingly trawl through annual reports with a calculator to hand. I'd rather not have to go back to that if there's free information available on the web.


Stockopedia (or Direct Source to company websites/investor relations)!

jonesa1
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Re: How is the annual management charge collected?

#343015

Postby jonesa1 » September 26th, 2020, 1:18 pm

WalterWalker1912 wrote:
Where do you guys go for your fundamentals?



I subscribe for email alerts on the LSE website for all the ITs I hold, that generates a lot of emails telling me the daily NAV, but also lets me know when more interesting announcements have been made by the companies. There's also access to a lot of info on the LSE site. If you want to research in depth, you could start with the most recent annual report, look for any Regulatory New Service (RNS) updates issued since the period covered by the report and have a look at the company's website for trading updates or insights.

WalterWalker1912
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Re: How is the annual management charge collected?

#343028

Postby WalterWalker1912 » September 26th, 2020, 2:48 pm

Thanks for that. Good to recall the LSE website. I always found that decent.

I imagine I'll drift back to Stockopedia at some point...

SalvorHardin
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Re: How is the annual management charge collected?

#343029

Postby SalvorHardin » September 26th, 2020, 2:49 pm

Information sources that I prefer:

Company websites. Can't beat the primary source. Especially when dealing with operating companies which report extraordinary items (which summary sites routinely treat as non-extraordinary items).

There's no way I'd ever invest in a company without looking at its most recent set of accounts, unless I'm adding to an existing holding.

Investegate for RNS news (official stock exchange announcements).

Stock exchange site for more RNS (particularly investment trust net asset vales).

Seeking Alpha for American and Canadian companies. It regularly links to Business Wire announcements, which I find are much easier to get from these links.

Toronto Stock Exchange for Canadian equivalent of RNS

Stockopedia, though I don't use it much

WalterWalker1912
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Re: How is the annual management charge collected?

#343031

Postby WalterWalker1912 » September 26th, 2020, 2:57 pm

Fantastic, thanks.


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