Tag: international investing

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Investment

Best Asian income investment trusts and ETFs

This is the second part of a review of Asian income funds and emerging market income funds for UK investors, focusing on investment trusts. Click here for Asian income funds – unit trust and oeics.

Asian income funds – investment trusts

There are three Asian income investment trusts in the UK market. And it shows how keen investors now are on the income theme that none trade at a significant discount to net asset value (NAV) – for most ITs, a small discount to NAV is normal.

The Aberdeen Asian Income Fund (LN:AAIF) has a rather different geographic focus to the funds we’ve already looked at in part one – it’s much more geared to Southeast Asia. Singapore is the single biggest holding at 20%, followed by Australia and then Malaysia and Thailand. It doesn’t include a sector breakdown in its factsheet, but I estimate that the biggest holdings are the familiar duo of financials and telecoms at 25% and 20% respectively

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Investment

Best Asian income funds and emerging market income funds

Asian income funds and emerging market income funds may sound like a contradiction. After all, Asia and emerging markets are supposed to be growth investments. So why turn to a growth market for income?

In fact, Asian income and emerging market income are themes that make a lot of sense when choosing funds, for several reasons.

First, emerging market dividends are no myth. Many emerging markets stocks now have a culture of paying high dividends, so they make up a major part of investment returns in several countries. Dividends accounted for 30% of Asia ex Japan returns over the past decade – about the same as in developed markets.

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Updates

International stock broker updates – Charles Stanley, Daniel Stewart, HMS Markets, Finasta, Orion Securities

There are a number of updates to the directory of international stock brokers. These include details of five more firms – two from the UK, one from Luxembourg and two from Lithuania – with a few more on the way.

Charles Stanley is a long established UK broker and it offers international stock trading for much of Asia, Greece, Poland and South Africa as well as the usual developed European and North American markets. This is a full-service private client stock broker, which means that fees are a little than the discount stock brokers and you’re probably looking at minimum trade sizes of £2,500-5,000 to be cost effective.

On the other hand, once you factor in better execution and other costs, firms such as these may be more cost-effective for larger international investments. For example, the currency conversion charges that most discount stock brokers charge should be far less with a good private client firm.

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Updates

Brazil, Russia, Turkey stock trading through Swissquote

Swissquote is now in the stock broker directory. This is a somewhat unusual firm, being an online execution-only broker that attempts to add on some of the flexibility that a traditional Swiss private bank provides for broker-assisted dealing.

This means that it will trade a fairly wide range of exchanges that are unusual among European retail stock brokers. If you want this kind of choice in one place, you’re normally talking about a minimum account size in the high net worth individual range. The international stock trading options include Brazil, Japan’s Osaka Stock Exchange (most firms only offer Tokyo), Russia, Sri Lanka, Turkey and many others.

The snag is that Swissquote is doing this through intermediaries and hence it’s not cheap. You’re talking CHF200-400 (US$200-400) minimum commission for most of these. So frequent trading in most of these markets is going to be impractical for most retail clients. But it could be useful for investors who want to make the occasional long-term investment in these markets.

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News

South Africa online stock trading from Saxo Bank

Saxo Bank is keeping very busy with new launches. After rolling out Japanese and Polish equities in the last couple of months, it’s now adding stocks and CFDs for South Africa. This makes it the first stock broker outside Africa to offer online trading in cash equities for the Johannesburg stock exchange to retail investors.

Rates look good  – 0.25% with a minimum of ZAR100 (US$12) is both cheaper than you’ll pay through other international stock brokers and cheaper than the local brokers. Unfortunately, South African investors can’t take advantage of this – due to local foreign exchange restrictions, Saxo Bank can’t offer the Johannesburg exchange to clients resident there.

It also won’t be available to Swiss residents due to client confidentiality laws there. But for international investors elsewhere, this looks like a helpful development. And the firm says more international markets are likely to be added over the next year or so – in which case, it will reinforce its position as one of the best brokers for international stock trading.

The international stock broker guide and stock broker comparison tables have been updated.

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News

Interactive Brokers now offering Singapore stocks

It didn’t get much of an announcement given that some customers have been lobbying for it for ages, but Interactive Brokers has finally added direct stock trading for Singapore to its platform (it’s had derivatives for years, but not cash equities).

This plugs the last major gap in the firm’s line-up. There are many other exchanges that it will hopefully eventually add, but the absence of SGX was always strange and the biggest limitation of Interactive Brokers’s otherwise very good and cheap service.

Fees are extremely competitive: 0.12% with a minimum of S$3. This compares with standard rates of around 0.275% and a minimum of S$25 in Singapore; even Saxo Bank charges 0.15%. The one caveat is that, judging by the wording of the announcement, Singapore residents still won’t be able to trade Singapore stocks through Interactive Brokers (presumably it doesn’t have a full local licence).

The stock broker list, stock broker comparison tables and Interactive Brokers profile have been updated.

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News

Cheap(er) international data through Interactive Brokers Information Systems (IBIS)

Interactive Brokers have recently announced an interesting new data product called Interactive Brokers Information Systems (IBIS) that seems to be trying to fill the gap for investors and traders who want extensive data and analytics services without the Bloomberg and Reuters-level price tag.

IBIS is available as an add-on to its Trader Workstation for Interactive Brokers’ clients (US$39/month, discounted against commissions) or as a stand-alone product for non-clients (US$69/month for the first year, rising to US$89/month afterwards). That’s the platform fee – you need to pay the relevant exchange and provider fees for price and data feeds on top of that.

Existing clients can already get data through Interactive Brokers on the same terms, so the extra US$39/month value in IBIS is presumably supposed to be the convenience of its interface, portfolio analytics, screening tools and other software. Each trader will have their own view on whether this is worth the money or not.

For non-clients, this now seems to be the cheapest stand-alone way to subscribe to international price and fundamental data. With an IBIS platform subscription, you can then get Reuters Worldwide Fundamentals for US$7/month, for example.

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Updates

Keytrade Bank – another offshore fund supermarket

Keytrade Bank is now in the broker directory. It offers stock broking services for a decent range of European markets, but the main reason it’s likely to be useful is its fund supermarket.

This is a similar offering to Internaxx, but covers more funds (although the two don’t overlap entirely – there are funds on Internaxx that Keytrade doesn’t carry). With no custody fees it may well work out as cheaper than Internaxx over the long run.

To read more on the options for expats and others struggling to find a fund supermarket that accept non-residents, see the guide to offshore fund supermarkets.

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Updates

Eastern Europe online stock trading with Brokerjet

Brokerjet, an online stock broker operated by Austria’s Erste Bank, is now in the broker directory. The firm could be very useful to investors buying shares in Eastern Europe, since it’s the first multimarket online broker to offer a good range of stock markets there that provides services in English.

The available stock markets in Eastern Europe are Croatia, Czech Republic, Hungary, Poland and Slovenia. Given that most of these are expensive and hard to access through foreign brokers, Brokerjet’s fees [PDF] look reasonably good at around €20-35 minimum, although Saxo Bank is cheaper for Poland.

The service also includes most Western European markets. International investors will probably have access to most of these through other stock brokers already, but the inclusion of the German regional markets could be helpful for some. These are not included in many international stock brokers’ coverage, since they are of limited interest to most investors.

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News

Saxo Bank now offering stock trading for Poland

Saxo Bank is shortly going to be offering cash equity trading on the Warsaw stock exchange (they already offer CFDs there). As far as I know, that makes them the only the second online broker outside Poland to do so, after Brokerjet.

Unlike most of Eastern Europe, Poland has a stock market that could probably attract wider international attention, with over 400 stocks at present. Many of the other former communist countries such as the Czech Republic and Hungary have just a handful.

The country came through the global crisis pretty well and its prospects are brighter than most of Europe. It should offer some good opportunities in the years ahead and it’s encouraging to see that international investors will finally have a low-cost way to access these.

Poland will be a bit more expensive than most of the Saxo Bank offering at 0.3%, with a minimum of 75 zloty (US$25, £15). But that’s still very competitive compared to traditional broker rates for markets like these.

The list of international stock brokers has been updated to include the details.