Wednesday 28 September 2016

[Wednesday Wisdom] Mark Cuban and dividend stocks

"I believe non-dividend stocks aren’t much more than baseball cards. They are worth what you can convince someone to pay for it."

Mark Cuban is an American businessman and investor. He is the owner of the NBA's Dallas Mavericks, Landmark Theatres, and Magnolia Pictures, and is the chairman of the HDTV cable network AXS TV. According to Forbes, he is worth USD 3.3 billion.

Sunday 25 September 2016

[Sunday Update] Quiet on the dividend front

There is no SA dividend news to report this week. Those of you tuned into the financial markets (for better or worse) will know that Governor Kganyago kept the repo rate steady at 7%. Inflation has dipped below the SARB's 3 - 6% target band which our friendly market commentators have used as justification for the SARB's move (or lack there of). Us long-term dividend investors just nod and smile and say "of course", we then get back to collecting our dividends.

Here is your updated dividend table:

Written by: Geoff Noble
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Friday 23 September 2016

Quick Friday Thought on Active Investment

I came across an article on LinkedIn called "The Professor Who Was Right About Index Funds All Along". The article is about Burton Malkiel and how he was right about the success of index funds many years before they became mainstream. I paused on an excerpt from his book, "A Random Walk Down Wall Street":
“a blindfolded monkey throwing darts at the stock listings could select a portfolio that would do just as well as one selected by the experts.”
Malkiel's quote made me chuckle as it is probably true that a blindfolded monkey can do just as well as the experts. And a blindfolded monkey doesn't charge 1.5% to 2% a year to do so! I find it amazing that in this day and age, investment houses continue to insist on building large research terms to find "alpha". It amazes me that such highly qualified and intelligent people can kid themselves on the value a big active investment team adds.

My point is this: While I am not really interested in debating the merits of full-blown active investing, I don't think the cost of most active investments is worth it. All you are doing is making someone else rich at your expense. I believe by investing a couple of hours a week in your own investment portfolio you can save yourself some money (a lot of money over the long-term) and do just as well as any so-called expert in the field.

Written by: Geoff Noble
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Wednesday 21 September 2016

[Wednesday Wisdom] Quote from Rockefeller

Today, we remember the wise words of Rockefeller. He was quite fond of collecting dividends!

Sunday 18 September 2016

[Sunday Update] More stocks added

Happy Sunday. I am writing from a cold and rainy Durban. I have added to the stock list and we are up to 41 companies. In the next couple of months, I hope to have 50 SA stocks and an international list of another 20 to 30 US, UK and Swiss stocks.

This week AVI and RMI reported results:

  • AVI increased their final dividend by 10% :) (Sens)
  • There was a little less cheer for the RMI increase of 2% (Sens)
Here is your list for this week:

Written by: Geoff Noble
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Disclaimer: I have tried my best to ensure that the table above is accurate. It is based on factual data and does not contain any recommendations. Errors and Omissions are Excluded (E&OE).

Wednesday 14 September 2016

[Wednesday Wisdom] Dividend thoughts from Bogle

Every Wednesday I will share a quote on dividend investing. This week's quote is from John Bogle. John Bogle is the founder of Vanguard. He is also seen as the father of passive investing. He has written many books on investing. The Clash of the Cultures is among one of my favourite investment books of all time.

Written by: Geoff Noble
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Sunday 11 September 2016

[Sunday Update] Busy week on Forget the Noise

It has been a busy week on Forget the Noise. I have added some more companies to the stocks list. The list now stands at 37 securities. I plan to add another 13 South African securities (50 in total). After that, I will create a US, UK and Swiss list of securities. Lastly, I will need to create a REIT (or listed property) list. You should then be well covered on the investment front. Remember, these are not recommendation lists but lists of factual information that should hopefully assist you in your quest to build a long-term income stream.

It has also been a busy couple of weeks on the results front:

  • MMI kept their final dividend flat (slightly up on full year basis - SENS)
  • Bidvest (BVT) decreased their dividend but these must be seen in the context of the Bidvest unbundling (SENS)
  • First Rand (FSR) increased their final dividend ever so slightly (by 1c per from 117c to 118c! - SENS)
  • RMB Holdings (RMH) decreased its final dividend from 154c to 153c (SENS)
I relentlessly write about "forgetting the noise" but this is not noise. Dividends are the key metric I monitor. I am concerned about the increasing lack of real dividend growth. I am not panicking just yet but I am aware the number of "Reds No's" in my table is growing. Not a pretty picture!

Written by: Geoff Noble
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Disclaimer: I have tried my best to ensure that the table above is accurate. It is based on factual data and does not contain any recommendations. Errors and Omissions are Excluded (E&OE).

Wednesday 7 September 2016

[Article] Don't be Fooled by Survivorship Bias

Ben Carlson wrote a great piece yesterday explaining survivorship bias in hedge fund indices. He used the infamous Long-Term Capital Management (LTCM) as an example. LTCM was full of brains (think PhD's and Noel Laureates) but had a spectacular downfall. Interestingly, only the positive results of LTCM's returns history are included in most hedge fund indices. At some point when LTCM started doing badly, they stopped reporting returns data which meant index providers stopped recording their results. This is an example of survivorship bias which is far too prevalent in finance.

Ben highlights the following to consider when looking at data:

  • Understand your sources of data.
  • Never blindly accept facts and figures about the markets just because they contain decimal places.
  • All numbers require context.
  • Look for holes in the data and your own thinking.
  • Don’t forget about implementation costs and behavioral issues.
  • You can use historical data to guide your actions, but always be aware of the limitations.

Read Ben's article here.

Written by: Geoff Noble
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Sunday 4 September 2016

[Sunday Update] Lots of Noise in South Africa

We have had a week full of political noise. None of it contributes much to society as a whole. I don't like commenting on politics as I believe the average man in the street (i.e. me) doesn't really know what is truly going on. As always, I prefer to focus on dividends.

Distell reported results this week and increased DPS by 9.5%. The full SENS announcement is here. Standard Bank also recently declared a dividend of R3.40 per share (up 11% on an annual basis - see SENS here).

Here is your updated table. I have added ten new securities. I will add another 18 and then move onto international stocks. This table is not a recommendation list. It is a table of historic dividend information.

Written by: Geoff Noble
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