ASB & Tabung Haji fund probably the most favorite unit trust/ mutual fund/ amanah saham (or whatever you want to call it) among us. Financially, both are good fund indeed since they provide modest return in the long-run.
What if I tell you, you can get higher return than ASB or Tabung Haji quite easily?
The way to go: buy high dividend yield stock…
Dividend yield (DY) is cumulative dividend payout for the past 365 days (can also be for that particular Financial Year (FY)) by the company to its shareholder divided by its share prices.
For example, if a company had been paying RM0.25 per share for the past 365 days and its share price is RM2.40, DY is about 10.4%. In this case, if you draw RM5000 from you ASB or Tabung Haji and buy this stock (for about 2083 unit), you stand a chance to receive RM216.63.
Now, try comparing that with your ASB or Tabung Haji return, which one you prefer?
You can use Business Section in your favorite local newspaper for quick comparison. I myself subscribed to STAR on daily basis. I love STAR than any other because their news reports are quite “neutral”. Speculation in media is normal but their journalists able to make it looks professional with some provoking thoughts.
Anyway, listed below are some of the listed companies that offering “double-digit” DY (price closed last Friday) & (may not be islamically viable):
| Company | DY |
| Maybank | 10.9 |
| Gamuda | 10.4 |
| Maybulk | 13.6 |
| BJCorp | 10.7 |
| JTInter | 11.5 |
| Media | 12.6 |
**P/S: Illustration Only
In most cases, unit trusts use this same strategy under “income fund”.
Unlike if you buy this “income fund” kind of unit trust, dividend payout that you’re going to get can help you reduce your income tax. Furthermore, it’s equivalent to “tax rebate” than just a regular “tax relief”.
Do you realize that if you invest in any income fund, your income is really subjected to double taxing?
First, when your fund manager received the dividend payout from a company, they have to pay tax to government as cost of doing business. Then, when they extend the profits to you (after the fund manager pay tax to government), you have to declare those dividends in your income tax; which obviously included in the taxable income.
Best of all, you don’t have to pay management fees which normally cost 0.5-1.5% too. 1% may sound very little sum, but if the return is only 5%, that’s equivalent to 20% profit reduction. I don’t know you but to me, that’s a lot!
Before you start buying any dividend stock, just hold tight. I’ll share kenapa kadang-kadang this type of strategy don’t work in the next article.
Interested to know more? Stay tuned…
Don’t forget to subscribe to my RSS Feed mentioned above if you are ready to get more return from this strategy… If you think this blog post can benefit others, let your friends know about this. Lagipun, that’s all good friends did if they found something useful themselves…
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