This is more of the notes I have gleaned from the book rather than a book review.
Book Title: Secrets Of Dividend Investors: The DIY Approach To Finding The Best Dividend Stocks
Author: Mark Lin.
Publisher: Rank Books. 2011.
There are many good investment books out there, but they are mostly based on US stocks.
I chose this book because it is written by a Singaporean about Singapore stocks.
The topic is about buying stocks for dividends which I have been doing for years.
Dividend investing does not take up much of my time monitoring ups and downs daily.
I want to become a more profitable dividend investor quickly, so read more I must.
Here are my 14 takeaways from the book Secrets of Dividend Investors by Mark Lin.
- Choose cash dividend over scrip dividend. We want cash flow.
- Do not buy dividend paying stock on XD. XD is the day it pays dividends and CD is after.
- A good dividend payout ratio is 50%++. DPR = dividends / net profit.
- Dividend yield should be at least 3%. Dividend yield = dividend per share /price per share.
- Choose companies in stable, non-cyclical industries, least affected by economic downturns.
- Choose companies with high dividend payout ratio, that are cash rich and mature.
- Choose companies with past track record of dividend payment. Check SGX website.
- Choose low risk, high returns, undervalued and high dividend paying stocks. Exist?
- Choose near monopoly companies. Eg SingPost and SPH.
- Choose REIT companies mandated to pay 90% income. Eg. Frasers Centrepoint Trust and K-REIT Asia.
- Other REIT companies? Eg. Capitamall, Starhill Global, Capitacommercial, Suntec REIT and CDL.
- Beware! REITs are in the cyclical industry highly subjected to economical downturn.
- Bonds vs Equity? Choose equity to buy part of the company. Bonds means lend money to the company. Choose Equity.
OK. Off I go to research and buy myself some more dividend paying stocks.
Although the book covers more formulae and calculations, I will just use point #7 above.
Wait… One more thing…
The book did not cover my one big question: Can you make a living investing in dividends? Let me know your experience in the comment box below.