As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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Welcome to Ministry of Wealth!

This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

"For the things we have to learn before we can do them, we learn by doing them." - Aristotle

It is here where I share with you how I did it! FREE Education in stock market wisdom.

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Value Investing
Dividend/Income Investing
Technical Analysis and Charting
Stock Tips

Wednesday, 7 April 2010

High Dividend Yield Stocks? - Part 3

High Dividend Yield Stocks? - Part 2

Difference in dividend payout by REITs and Business Trusts

Business trusts and REITs are also allowed to pay distributions to investors out of operating cash flow. This is unlike companies, which can only pay dividends out of accounting profits.

That means even when REITs and business trusts are not really doing well, they can still pay out dividends from their operating cash flow to give an impression that they are profitable. Do open your eyes when you see your dividends.


What Does Operating Cash Flow - OCF Mean?

The cash generated from the operations of a company, generally defined as revenues less all operating expenses, but calculated through a series of adjustments to net income. The OCF can be found on the statement of cash flows.

Also known as "cash flow provided by operations" or "cash flow from operating activities".

One method of calculated OCF is: EBIT + Depreciation - Taxes

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