I told you that only 17 profitable U.S. companies were paying yields of more than 12%... compared with 210 abroad. The numbers fluctuate day to day, but the trend is pretty clear.
I've researched this topic for years and the fact is, foreign companies are simply paying higher yields across the board.
In the table to the right you can see the difference between what we get from U.S. companies and what's available from international companies. Keep in mind that I only looked at the common stocks of companies that were profitable during the past year.
Truth is, the stocks in the S&P 500 pay an average yield of just 2.0%, making the United States one of the lowest-yielding markets in the world.
But go abroad, and you find something completely different. No, not every country is a dividend stalwart... but there are a surprising number of markets that more than double the yields found here in the United States.
Compare our 2.0% average yield with what I'm seeing in international markets.
According to Bloomberg, Germany's average yield is 3.6%... Brazil's average yield is 3.6%... the United Kingdom yields the same... Australia yields 4.7%... New Zealand pays 4.8%.
Take a look:
But there are more reasons to look abroad than just the dividend yields.
You see, there's a correlation between economic growth and rising stock prices. The faster the growth, typically the higher the stock market moves.So it shouldn't surprise you that in 2011 the S&P 500 returned about 2% (that's with dividends included!). When you look at the total performance worldwide, the U.S. market ranked just 13th in the world during that period. In other words, there were a dozen other places to make more money.
New Time 11:20 AM PT: Get the Market Movements in Advance: William's Edge Webinar for Wednesday April 23rd, 2014 | John Ransom
New Time 11:20 AM PT: Get the Market Movements in Advance: William's Edge Webinar for Tuesday April 22nd, 2014 | John Ransom