2011 Share Floats - What Will 2011 Hold For Investors In IPOs?

With the year now well underway, it's time to turn our attention to what the IPO market might throw our way in 2011. In terms of the number of new issues, last year was an improvement on 2009. Will 2011 be a better year again for investors in Australian share floats?

2010 saw 96 new listings worth a total of $7.5 billion. The monster float of the year was QR National. And despite some investor doubt in the run-up to the QRN share offer, the share price has actually performed fairly well. Shares are trading at $2.80 as I write this, which is a reasonable premium to the $2.45 paid by retail investors. Of course such short term price movement is likely to be driven more by sentiment than by fundamentals. The real test for QR National will be the next couple of years operating results.

Investing In Shares Or Property - Which Is Better?

This is a question which can almost cause good friends to come to blows. It seems that investing in residential property is such an emotional issue for some people. Well to add fuel to the fire I found the results of a study published last year found that investing in shares produced a better after tax return than investing in property.

The report was commissioned by the Australian Stock Exchange and prepared by Russell investments. It investigated the returns of a number of asset classes over the past 10 and 20 years taking into account the impact of investment costs, tax and borrowing on the on the final performance figures.

The headline result (certainly from the ASX's point of view) was that Australian shares outperformed all other asset classes on an after tax basis over 20 years for investors on both the lowest and highest marginal tax rates.

Highest Dividend Paying Stocks In The ASX100

It might surprise you to learn that over the long term dividends make up a large part of a share portfolio's returns. In a study by Elroy Dimson, Paul Marsh and Mike Staunton (see Keeping faith with stocks) it was found that "The longer the investment horizon, the more important is dividend income."

And for retirees, dividends are the life blood of their investment portfolio. While growth in the value of the portfolio is important in order to keep pace with inflation, it is the steady stream of dividends which pays the bills.

Even though I'm not a retiree, I still like dividends because along with my regular savings, they provide me with the cash to make further investments without the need to sell existing ones.

Best Shares To Buy In 2011

With 2010 out of the way, it's now time to turn our our attention to 2011. While I'm sure we'd all like to have a crystal ball which we could look into to see what shares prices have done up to the end of 2011, the reality is the future is unknown. So how can we best position our investment portfolios to grow in 2011? In other words, what are the best shares to buy in 2011.

Retail Shares?

One sector of the Australian stock market which has taken a pounding in recent times is the retail sector. Harvey Norman boss Gerry Harvey was pessimistic at the company's recent AGM. Discount retailer The Reject Shop, which has been an outstanding performer over recent years, shocked the market recently with a profit downgrade. The announcement saw The Reject Shop shares drop to below $13.00 from over $17.00. And shares in JB Hi-Fi have fallen in recent times as well over the uncertainty in near term retail sales figures.

Australian Exchange Traded Fund Range Bolstered By New iShares ETFs

The choice for ETF investors just got a little broader. Earlier this month BlackRock launched 4 new ASX listed Exchange Traded Funds all covering the Australian stock market. The table below list each of the 4 new funds.

ASX Code	Fund Name	Purpose of Fund
ILC	iShares S&P/ASX 20	Tracks the performance of the S&P/ASX 20 Index
IOZ	iShares MSCI Australia 200	Tracks the performance of the MSCI Australia 200 Index
ISO	iShares S&P/ASX Small Ordinaries	Tracks the performance of the S&P/ASX Small Ordinaries Index
IHD	iShares S&P/ASX High Dividend	Provides exposure to 50 of Australia's larger high dividend paying stocks

New iShares Exchange Traded Funds

Dividend Investing For Beginners

A well constructed portfolio of high dividend paying stocks is a great foundation upon which to build a strategy to achieve financial independence. It is the passive income derived from such a portfolio which grants us our financial freedom. There is no point in being asset-rich if we are cash-flow poor. In this article I'll discuss how stock market beginners can get started with dividend investing.

What Are Dividends?

They are payments made out of earnings from a company to its shareholders. What is paid is the portion of profits which a company doesn't need in order to maintain and grow the business. It is the reward which shareholders receive in return for providing capital to the business. Along with capital gains, it is how an investor profits from buying shares.

QRN - QR National Share Offer Document Now Available

Finally the big day for prospective QR National investors has arrived. The offer document has been released and now we get a chance to see what the 'big' fuss has all been about (don't tell me you haven't seen the ads). What follows are some of the highlights from the QR National prospectus.

How Much?

The indicative price range is between $2.50 and $3.00 per share with the final price paid by institutions (fund managers and the like) to be set by way of an institutional book build (kind of like an auction for the big boys). Retail investors will pay 10 cents per share less than the institutions up to a price of $2.80. I guess that means we will pay somewhere between $2.40 and $2.80 per share.