Sunday, 26 April 2015

10 FTSE Market Stocks with an ex dividend date 1st May – 7th May

I want to get into the way publishing this type of post because it helps my regular readers keep up to date with UK stocks that have an ex dividend date approaching. It also helps educate me about potential new stock buys as well as highlighting their dividend potential. Previously I discussed the ex dividend date of FTSE 100 stocks for April and afterwards I felt this post was very long winded, not to mention the fact that I did not get around to consider lots of potential high dividend yield stocks. I think focusing on one week will benefit both myself and my readers.

There are 10 FTSE market stocks with an ex dividend date of 7th May. Some of these are FTSE 100 companies while others are FTSE 250 companies. The more I look at these stocks the more I wish I had more spare money to invest in them. I will consider each in turn.

Acadia mining (ACA) is first up. It is a FTSE 250 company with a share price of 292 pence as we speak. It is set to pay 2.9 cents per share and the payment date is the 29th May 2015 so you do not have to wait too long to receive your dividend payment. I have read some of the broker views for this one and the consensus is that it is undervalued. The share hit a high of over 300 pence in January and I expect it to climb as it approaches it’s ex dividend date. I am not overly fussed on mining stocks especially one with a low dividend payment.

Admiral Group (ADM) is one of the top 100 companies in the United Kingdom and is currently priced at 1581 pence. While the dividend payment for this company is excellent, 49 pence per share, the company has recently reported a fall in profits for the first time in 10 years. This sort of news discourages me from investing in this particular company.

Barr A.G. (BAG) is a FTSE 250 company in the beverages industry and has a share price of 629 pence currently. It’s dividend payment is 9 pence a share and payday is the 5th June 2015.

Derwent London (DLN), another member of the FTSE 250 is trading at 3485 pence and has a relatively low dividend yield, only paying 28 pence for each share you hold.

G4S (GFS) is a support services company trading at just over 300 pence per share. This FTSE 250 company is paying out 5.82 pence per share in dividends on the 12th June. This has a higher yield than some of the other stocks listed here.

Henderson Group is in the financial services sector and seems to be an understated stock from what I can make out. It is trading at just under 287 pence and is set to pay a dividend of 6.4 pence per share making it a relatively high yield stock. If I bought 100 of these shares for £300 counting trading fee I would earn £6.40.

Morgan Advanced Materials is trading at 347 pence and has a dividend payment of 7 pence per share. The SP has risen from around 300 pence in December and I wish I had seen this one then.

Morrison Supermarkets has an excellent dividend yield paying out 9.62 pence per share whilst trading at under 200 pence. I could buy 100 of these counting trading fee for £206 and take advantage of £9.62 in dividends. I guess the bad news surrounding Tesco has made me nervous about investing in supermarket chains. My verdict on this one is more research is required.

Playtech is set to pay 17.5 cents as a dividend payment. This particular stock is trading at its one year high of 840 pence. The company is set to buy into an online binary and CFD broker which would potentially increase the SP and even dividend in the future.

The 10th stock with an ex dividend date of the 7th May is Rightmove. This particular stock has a dividend payment of 22 pence per share but it is rather expensive to buy in the first place; it is currently trading at over 3100 pence.

Out of these 10 stocks with approaching ex dividend dates I will be researching Morrisons more closely as I feel it is the most affordable company for me right now as well as having a decent dividend yield.

Friday, 24 April 2015

Starbucks expanding into food and alcohol in the UK market can only mean one thing for their share price- onwards and upwards

I am interested in food and beverage stocks especially coffee chains, like Starbucks. I am planning to invest in a coffee shop chain and probably will opt for Costa, which is part of the Whitbread company, however Starbucks is enticing me after reading their latest news. Yes the coffee giant are now offering food and alcohol. Starbucks seems to do most of their trade in airports here in the UK. I say this because I have seen Starbucks coffee shops close in my home town due to poor trade. It seems to do poorly compared to it's competitors in other cities and towns nearby BUT it does fabulous in airports partly because it is the only big brand coffee shop there. In saying that I am sure the lease for airport trading is incredibly expensive.

Starbucks has opened an alcohol and food franchise in Edinburgh airport. Airports are notoriously busy and people are known for enjoying a drink before they head off on their holidays. I for one would enjoy a nice glass of rose or prosecco, while my better half could have one of their fancy flavoured lattes. If we are feeling peckish we can take advantage of the prawn and chorizo skewers. We can then enjoy a delicious bun for dessert. I think the new revamped Starbucks will take off in a big way. If it proves to be successful in Edinburgh airport I can see it expanding their hot food and alcohol services to other UK airports and maybe some city franchises. I could see it doing well in a student area.

If you want to invest in Starbucks shares this year to take advantage of dividends, bad news as the ex dividend date was in February. However if you feel the same way as me and believe that the new menu will help the company grow and gain more profits you may be happy to purchase some shares and take advantage of future dividends.

Tesco is a company heading in the wrong direction

I often thought about investing in supermarket stocks and one of these was Tesco. For some reason I disliked this particular stock much more than say Sainsburys or Waitrose. I guess it is to do with my grocery shopping preference and the fact that I love collecting my Nectar points at Sainsburys.

After reading the latest Tesco news and seeing their reported 6.4 billion pounds in losses I am glad I stuck to my gut instinct on this one. Sometimes it is funny how you get a bad feeling about a company and at the time you cannot see why but it becomes apparent a year or two down the line. From what I have read and been told these past few weeks it is all doom and gloom for Tesco and as a result I can only see their share price going one way and that is down. I like companies with some form of growth and the fact that their stores. If company profits are at record lows dividends are likely to fall too and therefore this would not be a company I would want to invest my hard earned cash in.

I guess some people may hope that Tesco can turn it around and will be hoping to pick up a bargain as their share price drops. Right now the live Tesco share price is 224 pence (this is of 13.30 24th April). It was as low as 155 pence back in December and over 300 pence in May of last year. I cannot see it getting close to 300 pence again for some time. Decreasing profits and shop closures is very bad news for this company.

How can Tesco turn it around? I guess they can hope the price of their individual premises rises and their sales soar but hope gets you nowhere, action is needed. They need to concentrate on promoting their profitable stores and getting rid of their poorly performing stores. Some research needs to be done to find out why some stores perform well and others perform poorly, for example are the poor performers in areas with other high competition stores like Lidl or perhaps they have a unfavourable location away from major residential areas. I do wish Tesco all the best but for now I will stay clear of this supermarket stock.

Thursday, 23 April 2015

Ratesetter Monthly Lending Rate at an all time high of over 3%

This is a short update with the latest Ratesetter peer to peer lending news. I am shocked and pleased to report that a monthly loan has been matched at 3.1%. Previously the highest rate I seen was 3.0% recently and before that the rate never seemed to get above 2.9%. In fact I say it averaged around 2.7%.

Obviously a rise in interest rates is brilliant for lenders like myself. When I noticed the 3.0% figure yesterday for monthly lending I deposited some cash into my RateSetter account. Unfortunately due to more unexpected expenses this month I only made a small deposit. The money just cleared this morning and I have set my limit at 2.9% so I can get it lent out quickly. Earning 2.9% on my money for a month is better than most 1 year returns available at this moment in time. It equates to 2.32% for a basic rate taxpayer which is a reasonable return for only fixing your money for a month. Of course with this site your capital is at risk so I never invest large amounts monthly, just a little that I will not miss. To be honest the money I invest monthly would pay for one night's cocktails in my favourite bar and since I am pregnant I am saving this money anyhow.

I am guessing the rates are rising as it is approaching near payday and people are short of cash and looking for a little to tide them over until next week. Increased demand combined with decreased supply is every investors dream.

If you want to know more about RateSetter you can check out my review here

Monday, 20 April 2015

National Grid – potential FTSE 100 Dividend Stock for my portfolio

I really want to invest in some more dividend stocks and I feel like I should be selecting several stocks from the FTSE 100; they are the biggest companies in the UK after all. Selecting a variety rather than several from the same industry sector seems to be the way to go. I am particularly interested in banking and supermarket stocks but one other stock that has always been in my head is National Grid.

National Grid is in the gas, water and multiutilities sector. It concentrates on providing an essential service and therefore it currently is a useful stock to have in my portfolio. This stock is currently trading at under £9 a share. It is twice as expensive as my Royal Mail shares BUT it pays more than twice the dividend so it is something I am definitely interested in. I will of course reinvest all my dividend income and since the stock will be in my tax free stocks and shares ISA I will be exempt from paying tax on any gains so it is a win win situation.

Before I dive in and make an investment I want to research the dividend history of National Grid. If I do invest it is likely to be a small investment to get me started and ensure that I am inline for the next round of dividends which I believe are due to be paid during the summer months. I get paid in just under a fortnight and I would invest around this date. I am thinking my investment is likely to be around £400 which would get me 43 shares minus trading costs. I did some overtime at work so I might be able to stretch this to £500 but I shall have to wait and see what my payslip says.

The 2014/2015 preliminary results are released on the 21st of May and I believe this will dictate the dividends for this year. The ex dividend date is on the 4th June so I would need to buy this stock before then if I want to get the dividend payment in August. The dividend payments have been rising these past few years. In 2010 the total dividend was 38.49p per share, whilst it was 42.03p per share in 2014. This is a small rise in payments but a rise is better than a loss. However the dividend yield used to be over 6.7% and is now just over 5%. This is a higher rate than any bank account will offer.

My opinion on the future of National Grid and possible obstacles to its growth.

NG seems to be relatively stable right now. Of course any power outages or disruptions to the network could temporarily result in a fall in capital growth. The thing that concerns me is renewable energy sources such as those provided by solar and wind energy. I think these may take over and might reduce electricity usage in the future. If this happened I think it would impact negatively on the share price of National Grid and stop the company growing. However I do not think this will happen in the next few years as alternative energy sources have expensive start-up costs.

Thursday, 16 April 2015

My Daily Mortgage Interest on my rental property is at an all time low

I have one rental property which I lease out to a couple. I currently have a repayment mortgage as opposed to an interest only mortgage. I know some people with property investments like to collect a large rent payment each month and only pay the interest on their mortgage. Personally I hate having debt so I opted for a repayment mortgage. Fortunately my rent payment covers my mortgage payment, management fee, rates bill, gas certificate and other expenses. I still have a few hundred pounds left over each year too. Normally I use this money for repairs and the upkeep of the property.

I have a 2 year fixed mortgage with Halifax and my mortgage daily interest is dropping every month as the amount owed on the mortgage decreases. This makes me smile. I checked my mortgage account and was able to calculate the daily mortgage interest. Right now my daily interest is £3.42. This comes in at £106 monthly. My interest rate is low at 2.89%, which is reasonable for a buy to let mortgage. I can still remember the days of having a mortgage with 6% interest and paying as much as £9 daily towards mortgage interest.

I used to overpay my mortgage quite regularly but now I am concentrating on saving for a deposit for a new property for my husband and I. I am very happy to let my tenants pay my mortgage for now


Monday, 13 April 2015

Why a rise in the bank of England base rate would be good for peer lenders like me

The Bank of England base rate has been frozen at 0.5% since March 2009 and is likely to rise by the end of 2016. Experts have predicted that it may go to 1.5 or 2.5%. This is not good news for those with large mortgages or those with other debt; take heed and start overpaying your mortgage now. However a rise in the bank of England base rate would be good for peer to peer lenders like myself and it is easy to see how.

Peer to peer lending sites like Zopa and RateSetter will benefit investors if the Bank of England base rate increases. These sites do so well because they give borrowers the opportunity to borrow money from investors, i.e. lenders like you and I who offer them money at a lower interest rate than they would get from the bank. They can get money for a car loan from us from Zopa, RateSetter or other peer lending sites for three years charged at around 4% interest, provided they have good credit. A car garage can charge over 6% for the same loan, perhaps even more.

Lenders will be the winners and borrowers the losers with increased Bank of England base rates. Here is my theory how and it all comes down to supply and demand:- There will be a decreased supply of cash available for borrowers- lenders may not have as much spare cash to lend due to their own increased expenses from mortgages. There will be an increased demand for cash as car loans and other personal loans will cost more through banks than they do currently.

Decreased supply of cash, increased demand for cash = higher interest rates

Basically more people wanting money and less money available means higher interest rates for borrowers and this is fabulous news for investors. Those 3 year Zopa loans could bring in 6% or more for lenders as opposed to 4%. It is also important to remember that higher interest rates may also result in more people defaulting loan payments but that is another post altogether.

Will an increase in the bank of England base rate encourage people to play it safe with savings accounts or try and take advantage of higher interest rates with the likes of Zopa and Ratesetter? Personally I will do a little bit of both but I predict that many people will be pleased to get a few percent interest on their savings accounts again and fail to take opportunity of the better gains to be made from peer lending sites.

Tuesday, 7 April 2015

UK ex dividend dates for FTSE 100 Market stocks in April- Will I buy or not?

The UK stocks and shares ISA can be topped up again with the maximum holding and therefore I am looking for dividend stocks to boost my portfolio. I have decided to invest in stocks that are due to pay dividends sooner rather than later so I researched those with ex dividend dates in April. It can be hard to track down such stocks without visiting each individual company’s accounts but I am fortunate to have a list of my own which can be seen below.

I like to focus on respectable companies with a history of paying dividends so I focus on the FTSE 100 market stocks. I will consider each stock in turn mentioning the ex dividend date as well as the current share price and expected dividend per share. This is beneficial for me because it lets me home in on stocks that I might like to invest in.

Aviva, stock ticker AV is a life insurance stock with an ex dividend date of 8th April so you need to buy tomorrow if you want to take a share of the dividends. This particular stock is currently priced at 561 pence which represents a rise of 8 pence on the day’s trading. Back in January it was priced at under 475 pence so I guess then would have been the perfect time to buy into this stock. As it stands the ex dividend date is far too close and I will not be buying any Aviva shares. I do anticipate a slight rise in SP tomorrow again to reflect the fact that this is the last day to buy in to get dividends. For those that do wish to buy you can enjoy 12.25 pence dividend for each stock you hold

Friends Life Group, FLG, is another life insurance stock which might end up being taken over by Aviva if rumours are to be believed. This stock has also risen in price recently and is currently trading at 430 pence. January was a good time to buy in when shares were trading at 351 pence. This stock has an ex dividend date of 9th April and pays 24.10 pence per share. Here again I feel it is too close to ex dividend date to invest as the share price has already risen.

BAE Systems, BA is in the aerospace and defense industry. It is currently priced at 528.50 pence and has an ex dividend date of 16th April so you still have another week to purchase this particular stock to receive a dividend of 12.30 pence per share. This stock reached a 1 year high recently on the 20th March and I expect it to reach this share price again approaching it’s ex dividend date. I have absolutely no experience with the aerospace industry and this is what puts me off buying this particular stock. I do think I should do some reading around this particular company and see if I can convince myself to invest. I could start off with a small investment initially I guess. You know what they something is better than nothing.

If you are planning on investing a few thousand into a share with an upcoming ex dividend date this April you might want to consider the company, Reckitt Benckiser, RB which has a share price of 5960 pence and an ex dividend date of 16th April. Do not let the price put you off as this particular stock pays a hefty 79 pence per share. You would definitely need to purchase a sizeable number of shares to make your investment worthwhile. Ten shares would cost you almost £600 (in fact over it counting trading fees) and pay you a dividend of £7.90.

If media shares are your thing you may want an investment in TV channel ITV which is also part of the FTSE 100. It is more affordable at a share price of 257 pence, than some of the other stocks I have considered here. With an ex dividend date at the end of the month you have plenty of time to think about this. The dividends are reasonable at 9.55 pence per share. Compared to RB you could buy 233 of these shares for £600 and receive a dividend of £22.50 which is a better yield and might appeal to those with smaller amounts of cash to invest. This is definitely a possibility for me. I could reinvest the dividend and receive 8 or so shares in return. I will have to explore this company further.

Remember the ex dividend date is the last day to buy a share in one of these stocks to gain a dividend. The share price of these stocks rises around this date so I would suggest buying a few weeks in advance so that you can a better price. Market timing is extremely important and can strongly influence your profits or lack of them. If you are only planning on holding the stock for a short period of time then it may not be worth your while to purchase so close to the ex dividend date. Why pay a higher share price if you are only planning on short term trading? Buying close to the ex dividend date is perfect for those that wish to hold a stock for a long period of time and for those that are planning on reinvesting all their dividends. I have already started this process with Royal Mail Group and will continue with it when I receive my next round of dividends in July.

Will I buy some of these stocks mentioned? Well that depends on a few different things mainly my other expenses this month. Firstly I should mention that I am due to go off on maternity leave in three months and therefore I will have less spare cash (and time) to invest so I need to be sensible with the investments I am making now. Secondly my husband and I are planning on buying a beautiful new home and I have promised him a sizeable deposit from my cash ISA (I hate spending money that I have saved hard for but the new home will be worth it and at least we are increasing our assets, not to mention renting out the home we are currently living in- it all makes for a better retirement). Finally I have a flashing red alarm on my car, and of course my warranty has just expired meaning I will have to cough up for any expenses. However I had saved £950 for an investment in stocks which I never got around to spending so I may save some of this for my upcoming expenses and perhaps put the rest into one of the stocks above.

I will keep you all informed as to what company I have decided to invest in. If you have smaller amounts of cash to invest and cannot take advantage of buying stocks I will be back with a post on how to use a stock’s ex dividend date to make money.

Monday, 6 April 2015

It's ISA top up day

Yes the new tax year is upon us and the 6th April is the first day that you can top up your cash and stocks ISA. Remember the allowance is £15240 this year. I need my cash this financial year so I am not so sure whether I should top up my ISA temporarily and then withdraw the funds at a later stage.

It is also a good time to go searching for a better rate ISA especially if like mine your one year deal has ended. I am now only getting 0.25% interest which is pitiful. I do not want to fix my money as I may need it for my new house so I need a direct access ISA where there is no loss in interest for withdrawing money. Currently I am with Halifax and the rate there is 1.05% which is not as good as the 1.5% offered by Santander. However this rate is only available to 123 current account holders which I happen to be. I will be visiting my local Santander branch tomorrow and putting on an appointment to transfer my cash ISA to them.

Friday, 3 April 2015

Premium Bonds Have I won in April 2015

Premium Bonds have I won this month is the question I always ask on the third working day of every month. I only have a small holding, £5050 but still manage to win the odd £25 prize. Of course like most Premium Bonds holders I am waiting on the biggie, the coveted one million pound prize, which like all the other prizes is tax free. This prize would give me instant retirement and it is for this reason I never ever part with my NS&I Premium Bonds. I could invest the cash elsewhere but where would the fun be in that.

I logged onto my Have I won Android app this morning to find out that unfortunately I was not in the money. Yep this month I won nothing but there is always next month and the month after. The next winners will be announced in 33 days, which happens to be the 6th of May. Of course the big winners will be announced on 1st May and I always check to see if there are any from my region. What I particularly like to see is if any of these have a small investment. I notice one of the one million pound prize winners this month has under £13000 invested which proves that you do not need to have the maximum holding to win big. This gives me hope.

Thursday, 2 April 2015

How to invest £10 a month and make money

If you have minimal spare cash but want to grow your money you can still get in on the act with as little as a £10 investment per month. Sure £10 a month will not make you as rich as someone who invests £1000 a month but it is better than nothing and will motivate you to make savings on your daily expenditure to free up more cash for investments.

So how can you invest £10 a month and make something? There are several options, one of which I have just found recently myself.

The investment with the least risk is of course a savings account. You can put as little as £1 in a month and make some money. However the interest rates on current savings accounts are dire so I prefer something with a little risk and a higher rate of return. You would be looking at interest rates of no higher than 1.5%, not to mention the fact some accounts like Santander 123 current account require you to have £1000 to earn 1% per annum as well as a minimal monthly deposit of £500.

I prefer peer to peer lending sites like RateSetter which give me the option of lending £10 a month. The interest rate varies but I have seen it as high as 2.9%. I guess it depends on supply and demand. If there is a shortage of funds available then the interest rate will be higher. I will demonstrate with some figures in the table below which initially may make it seem as if it is not worth your while but I will show you how it all adds up. For the below calculations I am assuming the monthly interest rate to be 2.9% per annum.

Month Total Investment (£) Interest Gained Monthly (pence)
1 10 2.4
2 20 4.8
3 30 7.2
4 40 9.6
5 50 12
12 120 28.8
100 1000 240
240 2400 576

At the end of the first month the initial £10 is invested with the next monthly deposit of £10 making a total investment of £20 and so forth. Obviously the returns are very low but after 20 years you can expect to gain £5.76 a month in interest just by reinvesting all your money from month 1. It is important to note that you would get greater gains if you also reinvested your money interest. £10 a month will not be missed but after 20 years you will have £2400 in your account plus interest. Imagine if you were able to invest £20 a month or even £100 a month, the gains would be greater. Find out more about this site in my RateSetter review post.

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