Eureka Correspondence

50/200 day moving average, 99wuxian, franking credits.

50/200 day moving average

I found Percy Allan’s article, Don’t fear the doomsayers, very interesting. Is there anywhere the average investor can chart the 50/200 day moving average crossover for everyday use?

JW

Editor’s response: Thanks for your letter. Please see: Letters of the week, dated May 22, in which Percy Allan discusses the 50/200 day moving average.

99wuxian

I found Brendon Lau’s article, Chinese gun for ASX listings, very interesting. Following up on the expected listing of 99wuxian, is Brendon perhaps considering doing some further research on the company that would be available to subscribers?

HL

Brendon’s response: Thanks for your letter. For the time being I don’t plan on doing any further research on 99wuxian, as it is not part of the Uncapped 100.

Franking credits

One recent Saturday morning Robert Gottliebsen stepped into the breach while Alan Kohler was away in London. In the weekend briefing, Kohler’s Week: Gottliebsen’s post-election investment guide, he wrote:

“In the 2013-14 and 2014-15 financial years we are going to see big special dividends from companies with low gearing and undistributed franking credits.

“If they are not distributed before July 1, 2015 then it will require additional profits to distribute them because the franking rate declines from 30% to 28.5%.”

Is there any way, short of going through all the annual reports, of identifying companies matching those criteria?

Name withheld

Editor’s response: Thanks for your letter. We had a similar question regarding excess franking credits last week, for which Robert said: “You can find this information on a listed company’s full-year financial report on the ASX website. The first few will take an age but after that it should be quick. I would say you should start with Telstra and the banks, then go to Wesfarmers and Woolworths. Look at companies with large operations in Australia.”

Health/welfare versus infrastructure

As always I found Alan’s weekend briefing, Kohler’s Week: Oh politics!, Infrastructure, UK economy, excellent reading.

The comments on the effects of the ever-increasing expenditure on health and welfare and the impact that it might have/had/be having on expenditure on infrastructure are very interesting. I would be interested to see statistics around the issue that could give a better picture of this trend over the past 50 years. Comparing Australia to the UK and US would also be enlightening.

Cheers!

CB

Tackling foreign investment

To make residential property affordable for residents, something needs to be done about foreign investment. How can today’s 20-somethings compete against rich investors from China? Government handouts are completely missing the point.

Name withheld