Assuming that the second dividend payout for 2009 will also be $0.05 per share, the total dividend payout for 2009 will be $100. Using the latest closing price for the STI ETF which is at $1.73, the current dividend yield is around $0.10 / $1.73 * 100 = 5.78% and this is a rather decent amount. However, the dividend payout has dropped as compared to 2008 as the STI ETF distributed a total of $0.12 per share for the year 2008. The drop is understandable due to the fall in earnings by companies and the decision of some companies to lower their dividend to preserve more cash in their balance sheet for the challenging market conditions ahead.
Meanwhile, my advice will be to hang on and rough it out through the current poor economic outlook with your holdings of the STI ETF or any other fundamentally strong stocks. Wait for the market to recover and you should be sitting on some capital gains along with the dividends which you have collected throughout the wait.
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Do they have any cut off period for the dividend entitlement? cos I just bought some on Nov 08 and on last friday.
ReplyDeleteI believe they have a cut off period for the dividend entitlement. The ex-date for STI ETF was on 22nd January which was last Thursday. That means that from the 22nd of January onwards, there will be a XD sign beside the STI ETF on the market. Unfortunately, you must make your purchase before the ex-date to be entitled to dividends. Thus with regards to your question, I believe that the purchase you made on Nov 08 will be entitled to dividends while the purchase you made on Friday will not be entitled to dividends.
ReplyDeleteHi Kay,
ReplyDeleteDo we have to declare the dividend that we received in our tax assessment?
YC
Hi YC,
ReplyDeleteI don't think you need to declare your dividend if you are a citizen. As taken from the IRAS website @ http://www.iras.gov.sg/irasHome/page03_ektid5984.aspx
"You need to declare the taxable dividends under 'other income', and the amount of tax deducted (please refer to your dividend vouchers/statements) under ‘Singapore tax deducted at source’ in your tax form."
"However, if you hold a Singapore NRIC, the relevant companies paying the dividends will provide information on your taxable dividends to us. You need not declare the dividends (this does not apply to dividends received by joint account holders or where shares are held through nominees)."