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Arb's April topups

Practical discussions about equity High-Yield Portfolios (HYP) for income
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Arborbridge
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Arb's April topups

#215606

Postby Arborbridge » April 17th, 2019, 10:54 am

I've already bought a new holding this month (Smith, D S) but this leavess cash in the same account for a couple of topups.
The winners were VOD (up to median weight) and SLA (just under median weight) - with deference to Dod, who would certainly not approve 8-)

The resulting top twelve in my table look like this:



WPP looks like the next in line - I might even be tempted before May!

Arb.

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Re: Arb's April topups

#215609

Postby Dod101 » April 17th, 2019, 10:59 am

Thanks for the mention Arb but whether I approve or not does not matter :) I would certainly call them brave decisions; maybe I am missing out on the best yields for a long while. I topped up Schroders earlier this week with some dividends that I seemed to have spare, sitting in one of my ISAs.

Dod

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Re: Arb's April topups

#215619

Postby PinkDalek » April 17th, 2019, 11:32 am

Dod101 wrote:I topped up Schroders earlier this week ...


Yielding about 3.6%?

The Board will recommend to shareholders at the Annual General Meeting a final dividend of 79 pence per share (2017: 79 pence) bringing the full year dividend to 114 pence per share (2017: 113 pence). The final dividend will be paid on 9 May 2019 to shareholders on the register at 29 March 2019.

114/3161 (depending on when this week) gives about 3.6%.

Of course, if you used the December 2018 share price you'd end up with a higher percentage!

IanTHughes
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Re: Arb's April topups

#215622

Postby IanTHughes » April 17th, 2019, 11:48 am

PinkDalek wrote:
Dod101 wrote:I topped up Schroders earlier this week ...

Yielding about 3.6%?

The Board will recommend to shareholders at the Annual General Meeting a final dividend of 79 pence per share (2017: 79 pence) bringing the full year dividend to 114 pence per share (2017: 113 pence). The final dividend will be paid on 9 May 2019 to shareholders on the register at 29 March 2019.

114/3161 (depending on when this week) gives about 3.6%.

Of course, if you used the December 2018 share price you'd end up with a higher percentage!

You have quoted the price for Schroders Voting shares whereas I believe Dod101 holds the Non Voting alternative where the price is currently 2410, or thereabouts.

Mind you, this still means a relatively paltry yield of 4.73%, relative that is to many other perfectly acceptable HYP candidates.


Ian

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Re: Arb's April topups

#215624

Postby PinkDalek » April 17th, 2019, 11:55 am

IanTHughes wrote:You have quoted the price for Schroders Voting shares whereas I believe Dod101 holds the Non Voting alternative where the price is currently 2410, or thereabouts.


I did wonder but I think Dod101 is often one of the first to say full names should be used (when tickers only are provided).

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Re: Arb's April topups

#215627

Postby Dod101 » April 17th, 2019, 12:09 pm

ITH is quite right and I suspect that PD may be being a little pedantic since this is the HYP Practical Board. However it is true that I might have said Schroder Non Voting shares, but even I would not buy a yield of under 4% for my HYP.

Dod

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Re: Arb's April topups

#215637

Postby IanTHughes » April 17th, 2019, 12:29 pm

Dod101 wrote:However it is true that I might have said Schroder Non Voting shares, but even I would not buy a yield of under 4% for my HYP.

Oh do come off it! If you would not buy such a share for yourself, you do routinely recommend such shares for others.

viewtopic.php?f=31&t=16680&p=206771&hilit=unilever#p206771

Dod101 wrote:You are looking long term presumably so you need the long term survivors such as Unilever, Legal & General, AstraZeneca (maybe a better bet in the short term anyway than Glaxo).

At the time, 10 March 2019, Unilever (ULVR) was barely yielding 3.00% and AstraZeneca (AZN) was not much better at about 3.50%. Indeed, for almost 10 years, ULVR has never yielded more than 4.00% and yet has regularly been extolled by you, not simply as a candidate but a "must have", for any HYP.

https://www.dividenddata.co.uk/dividend ... ?epic=ulvr


Ian

Dod101
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Re: Arb's April topups

#215639

Postby Dod101 » April 17th, 2019, 12:38 pm

I know that Ian. Unilever is indeed great 'ballast' for any HYP. I am not going to argue the point but I have always mentioned the Schroders Non Voting and would never buy the voting shares rather than the non voting, given the choice.

If there were no Non Voting shares of Schroder available, I would certainly hold the others but would not hold them in my HYP. They would be in what I call my Growth portfolio.

Dod

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Re: Arb's April topups

#215651

Postby PinkDalek » April 17th, 2019, 1:08 pm

Dod101 wrote:ITH is quite right and I suspect that PD may be being a little pedantic since this is the HYP Practical Board. However it is true that I might have said Schroder Non Voting shares, but even I would not buy a yield of under 4% for my HYP.


I wasn't being pedantic. I looked up the wrong share. December 2018 or some of March 2019 would have been a good time to have picked up the Non voting shares but, unfortunately, I wasn't in the High Yield market at the time.

How do you see their future dividend growth, noting their most recent increase from £1.13 to £1.14 for 2018 v 2017 looks to have been arrived at solely to indicate an increase (a rounding item to many)?

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Re: Arb's April topups

#215655

Postby IanTHughes » April 17th, 2019, 1:13 pm

Dod101 wrote:I know that Ian. Unilever is indeed great 'ballast' for any HYP.

So when you said:
Dod101 wrote:Even I would not buy a yield of under 4% for my HYP.

Was that simply a fabrication on your part?


Ian

Arborbridge
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Re: Arb's April topups

#215657

Postby Arborbridge » April 17th, 2019, 1:21 pm

Let's not go through the usual knock-about conversation between you two Ian and Dod. It's like those endless repeats on TV ;)


Arb.

Moderator Message:
ITH & Dod: consider this a moderation request, as well. It's not going to add anything to people's understanding or practice of HYP investing. None of us is perfect, or perfectly consistent, for that matter. -- MDW1954

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Re: Arb's April topups

#215690

Postby Dod101 » April 17th, 2019, 3:43 pm

Indeed, I had no intention of taking this any further but did not see that it was necessary to say so.

Dod

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Re: Arb's April topups

#215742

Postby Breelander » April 17th, 2019, 7:26 pm

IanTHughes wrote:ULVR has never yielded more than 4.00% and yet has regularly been extolled ... not simply as a candidate but a "must have", for any HYP.


Quite right, ULVR only had a ttm yield of 3.9% on 10th March 2011 when I bought it for my HYP. What you are conveniently overlooking is that at that time the ftse100 had a yield somewhere between 3.0% to 3.5%. So there are times when the likes of ULVR are 'High Yield' by any practical definition.

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Re: Arb's April topups

#215834

Postby daveh » April 18th, 2019, 8:11 am

Arborbridge wrote:I've already bought a new holding this month (Smith, D S) but this leavess cash in the same account for a couple of topups.
The winners were VOD (up to median weight) and SLA (just under median weight) - with deference to Dod, who would certainly not approve 8-)

Arb.



As Humphrey might say "a brave decision Minister" - but I also topped up VOD (& TRIG) yesterday with accumulated dividends in my HYP. Vod was top of my HYPTUSS table when I set up the one off regular purchase and has dropped back to 2nd place after the top up. GFRD is now in top spot - up from 5th place due to their massive price fall earlier in the week. I won't even be thinking of topping up GFRD until their results are out and there is a clearer view on where they are gooing with the Construction arm and if the dividend is looking secure (or not). TRIG doesn't appear in HYPTUSS, but will be getting most top ups in my main ISA account until it reaches median size. My second smaller ISA account will be getting this years ISA allowance. Not yet sure whether that will just go into top ups or if I'll make a new purchase. I like to try and not split shareholdings across brokers if at all possible.

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Re: Arb's April topups

#215855

Postby idpickering » April 18th, 2019, 9:47 am

Next week I’m buying more Vodafone too, along with top ups of WPP and Unilever.

Ian.

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Re: Arb's April topups

#215873

Postby Gengulphus » April 18th, 2019, 10:28 am

PinkDalek wrote:
IanTHughes wrote:You have quoted the price for Schroders Voting shares whereas I believe Dod101 holds the Non Voting alternative where the price is currently 2410, or thereabouts.

I did wonder but I think Dod101 is often one of the first to say full names should be used (when tickers only are provided).

I have always taken the appeal for full names to be for company names, with "full" actually mainly to emphasise the difference from tickers rather than intended to be taken absolutely literally. If it is intended to be taken literally, I'll note that not one person in this thread has actually used the company's full name, which is "Schroders plc". And when did you last see people talking about "The British Land Company PLC", as the name appears in its latest Articles of Association, let alone "BRITISH LAND COMPANY PUBLIC LIMITED COMPANY(THE)"?

Using the company's full name wouldn't distinguish between its two classes of share anyway - for that, you'd need the full name of the share class as well. So perhaps everybody should really be talking about "Schroders plc Ordinary shares" and "Schroders plc Non-Voting Ordinary shares"?

In case anyone feels this is all absurd, agreed, but that's my point! Asking people to use full names really is absurd. There's a real point to using company names rather than just their tickers (*), but that point is served adequately by giving enough of its name to help people recognise the company. It's good if people clarify the share class as well when there's more than one possibility, which a ticker can do e.g. by saying "Shell (RDSB)" or "Schroders (SDRC)", but "Shell" or "Schroders" is not an incorrect description - just one that isn't entirely adequate to clarify what share they're talking about. When they fail to clarify that, I recommend assuming the one that actually makes sense in the context of this board - there are actually quite a lot of cases where people are already doing that automatically, such as assuming "Aviva" means the ordinary shares (AV.) and not either of their two types of preference share (AV.A and AV.B).

(*) It's to assist readers who are less familiar with the stockmarket in knowing what company you're talking about. HYP is a strategy designed to appeal to such people (however much some posters seem to believe that it's essential to watch the stockmarket like a hawk), and although it's not much trouble for such a reader to type a ticker they're unfamiliar with into any of dozens of websites and get a page that names and describes the company, it's also not much trouble for a poster to type e.g. "IG Group (IGG)" the first time they mention the company in their post and thereafter use just "IGG". Overall, a poster taking that trouble may well be saving dozens of readers a comparable amount of trouble...

Gengulphus

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Re: Arb's April topups

#215888

Postby Gengulphus » April 18th, 2019, 10:57 am

With my clarification:

PinkDalek wrote:How do you see their [Schroders'] future dividend growth, noting their most recent increase from £1.13 to £1.14 for 2018 v 2017 looks to have been arrived at solely to indicate an increase (a rounding item to many)?

Given that they increased the interim from 34p to 35p, then held the final at 79p, I think they were probably thinking at the interim stage that they could manage a roughly inflation-equalling increase, then deciding at the final stage that equalling inflation was a bit too ambitious and they should hold the dividend. They could have reduced the final to 78p to hold the total payout, but that would inevitably get noticed as a "cut" - I've seen AstraZeneca's reduction of their final from 195c to 190c in their 2012 results when their total remained unchanged at 280c mentioned as such, for example.

So while it's clear that they no longer feel that the company's earnings are adequate to fund dividend increases and that's definitely not good news, I don't feel that they can reasonably be accused of manufacturing a not-really-justified dividend increase: they've simply chosen one of two methods of moving to held dividends when neither is entirely satisfactory. That's on the evidence so far: if they increase the total payout to 115p for 2019, I'll definitely think again, essentially on the grounds that either resuming dividend growth is justified by the earnings or it isn't, and neither should result in a half-hearted dividend increase...

Gengulphus

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Re: Arb's April topups

#216010

Postby Dod101 » April 18th, 2019, 4:42 pm

Adding to what Gengulphus has said, I think the background to Schroder is worth looking at as well, in the context of the very modest increase in the dividend. Schroder is a very conservative operation and looks long term at its business (as befits a very much family controlled operation). I appreciate that in itself does not help as far as the dividend is concerned but I think we can rest reasonably assured that the dividend payment can be relied upon and will be increased when the company deems it can afford to do so. Contrast that with SLA, a company driven by deals such that it has been and still is very difficult to see what it is doing and where it is going. That is presumably why the SLA yield is where it is compared to Schroders.

Dod

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Re: Arb's April topups

#216055

Postby IanTHughes » April 18th, 2019, 7:29 pm

Dod101 wrote:Schroder is a very conservative operation and looks long term at its business (as befits a very much family controlled operation). I appreciate that in itself does not help as far as the dividend is concerned but I think we can rest reasonably assured that the dividend payment can be relied upon and will be increased when the company deems it can afford to do so. Contrast that with SLA, a company driven by deals such that it has been and still is very difficult to see what it is doing and where it is going. That is presumably why the SLA yield is where it is compared to Schroders.

I think you are forgetting, once again, that the Board of Directors of Standard Aberdeen (SLA) has categorically stated that they intend the dividend for 2019 to be 21.6p

But, as pyad has already stated in your misleading this board about the true yield for SLA:

pyad wrote:Why adulterate a misleading argument with facts?


Ian

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Re: Arb's April topups

#216060

Postby richfool » April 18th, 2019, 7:52 pm

Dod101 wrote: Contrast that with SLA, a company driven by deals such that it has been and still is very difficult to see what it is doing and where it is going

That all sounds a bit mysterious, - like it's an exercise in smoke and mirrors! Surely all it did, after SL merged with Aberdeen, was to sell off its life book/portfolio, to concentrate on asset management, and it's going through a period of change.

As far as I am aware, it hasn't cut its dividend, indeed it has stated that it will be maintained for 2019. I would guess after that it will depend on how the business performs.

I am a holder and I topped up when it got down to 232p.


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