5 Foreign Funds for Income
If you’d rather not pick individual stocks, you can choose from a growing number of mutual funds and exchange-traded funds that focus on foreign dividend payers. Funds normally pay dividends twice a year, and sometimes they pay quarterly.
Run by an old-line New York City firm with a penchant for bargains, Tweedy, Browne Worldwide High Dividend Yield Value Fund (symbol TBHDX) holds high-yielding stocks all over the globe. At last report, 30% of the fund’s stocks were U.S. names. Mostly, though, the fund holds foreign blue chips, such as Novartis and Unilever. It yields 2.6%, and over the past year it gained 5.7% (results are through August 8). The MSCI EAFE index lost 0.7% over the past year.
Matthews Asia Dividend Investor (MAPIX) probes the globe’s healthiest economic region for firms of all sizes, most of which you wouldn’t recognize. It returned 1.0% over the past year; the current yield is 3.2%. Like the Tweedy, Browne fund, the Matthews fund does not levy a sales charge.
If you want maximum yield, check out SPDR Dow Jones International Real Estate ETF (RWX). The ETF, which invests in property stocks, sports a whopping 10.2% current yield. Over the past year, it produced a total return of 6.2%.
For broader diversification, use SPDR S&P International Dividend ETF (DWX), which owns shares of 125 foreign companies of all sizes and in all industries. It yields a solid 5.9%; over one year, it lost 0.8%.
PowerShares International Dividend Achievers (PID), which pays 3.8%, has half of its assets in the United Kingdom and Canada. All of its stocks have boosted dividends at least five years in a row. The fund returned 0.8% over the past year.