Thai brokers lack on reporting of dividends.
Lack of reporting on dividends by Thai brokers indirectly suggest these don't matter. Au Contraire. Its high time they change this stale practice.
On the Thai Stock Exchange (SET), many smaller higher growing companies pay very high dividends, some twice the exchanges' average. Many twice a year. Yet, this hardly ever gets elevated by broker whom are trading/transaction driven around large cap stocks. Trading is always a specualtive activity and is not the same as investing!
Large cap Thai stocks trade with more share liquidity and this is paramount to institional investors whom invest millions of Dollars into a single stock. Individuals don't need this as they invest much smaller sums. Why pay double the p/e ratio for a good stock just because it trades more shares each day? When in fact you as individual just don't need this massive liquidity insitutions require? Why pay for something you don't need??
Below is a letter sent to the Bangkok Post on March 16th. It was published today (-of course as always taking out Thaistocks.com). Lets see if some get awakened. The quote on that 90% of traders loose actually came from in fact the manager of a broker office here.
"Brokers deter investors
It is unfortunate that Thai brokers do not show clients their dividend income. I mean, not just with an a email, when the stock goes XD, but year to date or since the start of their account.
A stock's true and fair present value, by finance's very definition, is the summary of all future dividends, discounted back to the present. Dividends are a very important and integral part to the serious long-term investor, even if not so to the day trading speculator. Not showing dividends sends the wrong message and is against international standards.
By not disclosing a client's total dividends earned anywhere on their electronic (or otherwise) statements, the broker is in an indirect way saying dividends do not matter. Many new, serious long-term investors would be enticed to be more actively investing in the Stock Exchange of Thailand (SET) if they saw the long-term benefits of high dividend income, compared to the low interest rate they get on their Thai bank savings accounts.
Thailand's brokers are well behind. Not showing dividends on statements sends the wrong indirect message.
At a recent meeting of ''SET in the City'', more then one marketing officer told me that 90% of their trading accounts lose money and so eventually leave, only to then badmouth the SET. In fact, the strategy failed, not the SET.
Not showing total dividend income anywhere on broker statements is yet another step to preserve the status quo, which has resulted in the past 10 years of no growth in retail clients despite the income per capita having doubled. As one senior executive told me last week, it's ''the real failure of the industry''. He was speaking about why the retail customer base is not growing in Thailand.
I just feel sorry for all the good Thai people who remain very confused about how to save or invest responsibly. One just minor shortcoming is that they can't even see a single number on total dividends earned through holding their shares.
PAUL RENAUD "
