iQ International Buyback & Dividend Model
INVESTMENT OBJECTIVE
The iQ International Buyback & Dividend Model seeks to expose investors to international companies that return capital to shareholders through dividends and share buybacks.
PROCESS
The Model follows the following rules-based and emotional selection process:
Start with the 250 largest non-United States companies traded on domestic exchanges.
Rank the 250 companies by Share Buyback Ratio and keep the top 50.
Rank the remaining 50 companies by Operating Cash Flow to Price ratio and kickout the bottom 10.
Rank the remaining 40 companies by Dividend Yield and keep the top 10.
This model reconstitutes every February, May, August and November
Potential Benefits
By investing in companies that engage in both share buybacks and dividend payments, investors can potentially benefit from:
Enhanced Earnings per Share: Share buybacks reduce outstanding shares, leading to potential growth in earnings per share. Dividends provide regular income to investors, boosting overall returns.
Increased Shareholder Value: Buybacks and dividends can increase the value of shareholders' investments by improving ownership stakes and providing consistent returns.
Exposure to International Markets: Owning international stocks allows diversification across global markets, potentially capturing growth opportunities in different regions.
Attractive Financial Health: Companies engaged in buybacks and dividends may be perceived as financially sound and well-managed, attracting investors seeking stable and well-performing companies.
Lower Risk: The combination of dividends and buybacks can offer a lower-risk investment strategy, as it signifies the company's commitment to returning capital to shareholders.
Long-Term Growth Potential: By investing in companies with strong fundamentals and shareholder-friendly practices, the strategy may offer the potential for long-term capital appreciation.
International share buyback and income investment strategies involve investing in companies based outside the United States that return capital to shareholders through share buybacks and income distributions like dividends. These strategies seek exposure to international markets and potential capital appreciation while generating income for investors. However, they come with inherent risks, including geopolitical, economic, and currency fluctuations that may impact investment performance.