Question before launch?

[duncan33]

Hello Jerome,
I plan to start with 2000€, I have a few questions before starting:

– Should I get into PEA where the opportunities are fewer but the tax system is more attractive or into a securities account?

-Before buying I plan to do an analysis, so I will check the distribution rate, that the dividends have been increasing for about ten years, that the annual growth rate is greater than 7%, and that the yield is greater than 4%.
Is there any data missing? Does it seem correct to you? How can I find all this information?

-Which online banks or brokers do you recommend?

Thank you to you

Julian

[Jerome]

Hello Julien,

– Should I get into PEA where the opportunities are fewer but the tax system is more attractive or into a securities account?

I don't know the French PEA system very well, but from what I understand you are limited in terms of the choice of your securities, with no possibility of investing in American stocks. So I would say that even if the tax system is interesting, it would be a shame to deprive yourself of a securities account with US stocks. I think that the PEA is a bit like a 3rd pillar account in Switzerland, and if that is the case, the ideal is to have both, one for the tax advantage, the other for the choice of stocks.

Before buying I plan to do an analysis, so I will check the distribution rate, that the dividends have been increasing for about ten years, that the annual growth rate is greater than 7%, and that the yield is greater than 4%. Is there any data missing? Does it seem correct to you? How can I find all this information?

This is a good basis. Personally I think the bar is set very high with a yield of 4%. You will deprive yourself of quality stocks that may have a slightly lower yield, but that have more growth potential (for example a stock that offers a very low distribution ratio). You also risk coming across stocks that will have difficulty ensuring dividend growth, or worse, that will have to drop or even stop paying distributions altogether. You will find this information on Yahoo Finance, Morningstar, Dividendinvestor or Financial Times, it depends on what exactly you are looking for.

-Which online banks or brokers do you recommend?

I don't advise anything...! The interest of growing dividends is not to trade, but just to invest. I don't think the choice of a broker or online bank is important. Personally, I go through my traditional bank and it's going very well...

[duncan33]

Thank you for your reply.
I actually think I'll open both.
Regarding the 4%, I realized while reading your ebook that it was too much, that it was better to start from 2.5 and increase by 10%/year than to start high and decrease.
Regarding the consecutive years of increase, how many years minimum are you basing this on?
I think I'll go through Binck.fr, being 300km from my bank for my studies I will have greater freedom.

[Jerome]

for the number of years let's say that below seven, it's useless to go into it, from double it's potentially interesting, but we have to see what the rest says...
It remains a macro rule because a title can compensate for a weak history with a very low payout for example, but let's say that with a minimum of seven years of consecutive dividend increases, we ensure that the company has already gone through unfavorable economic conditions while continuing to reward its shareholders, which demonstrates good resistance of the company's business model and a sustainability policy led by the Board of Directors.

[Author]

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