Not much, I suppose.
There isn’t actually a Hello Kitty stock, of course; the character is a property (doesn’t that sound so cold?) of Sanrio, a company in Japan. Seems HK is an even bigger deal over there, definitely Sanrio’s cash cow. The little mink is worth seven bill a year. I am looking into this for a simple reason: all of my wife’s stock recommendations, except those where I help pick the stock, do well. Since she had thought about this before I did, just hadn’t gotten around to asking me, this makes it a Deb-Approved Security that should do well.
If it does well, I don’t give a damn how silly a security looks. (Or how odious. I don’t believe in ethical investing. I believe in activism, and in investing for gain, but I do not believe in confusing the two.)
I’m not sure how easy it is to trade the shares on the Tokyo exchange, but it has US-traded shares as SNROF. Did you know that, that in most cases you can buy major foreign companies on the US markets? Generally you can. However, you can face a number of issues. You will certainly pay foreign tax, and in some cases ADR (American Depositary [spelling is correct] Receipt) fees. And yes, this means if you get a dividend, you will have to check ‘yes’ on your tax return when it asks “Did you have any foreign income?” In case you’re interested, a five-letter ticker ending in F is a foreign stock. A five-letter ticker ending in Y is typical an ADR (the distinction is not tremendously important). Some foreign stocks do not have five-letter tickers, like Toyota (TM).
Thus, this has me researching a way to buy shares of a foreign company whose main revenue generator is the image of a cartoon cat. Why would I be all right with this? In addition to the noteworthy fact that it’s Deb-approved, it’s near a long-term low. It does not look to have much downside, and based on its price history, has potential for a four-bag upside. I’m enamored of stocks my wife likes that are cheap at the price. I’m also enamored of 4% dividend yields, especially when payout seems on the upswing.
I’m greedy on dividends. I am not a fan of annual report proclamations (authored by management) of how great management is, how we’re all going to roll in money, and so on. I think: “Screw you. Pay up. If I’m going to hold this, I expect compensation now and frequently. That’s money you can’t take back later. If you bomb financially, and you don’t pay up, no problem. I was just in it for the money and I’ll be going then.”
I’m less enamored of low liquidity. One has to watch for that with foreign shares, and with quite a few investments. During Friday’s trading day, according to my research, only 100 shares of SNROF traded. That’s it. What if someone had wanted to buy 200? Might not have gotten them, especially at a limit price. People need to remember that you don’t automatically get to sell stock and ETF shares; they are not sold into a void. They are sold to someone else who wants to own them. If you want to sell, and there isn’t enough buying interest, maybe you can’t sell at all. By the same token, if no one wants to sell you any shares, you can’t buy them. Oh, someone will always cough them up–but not always at a limit price.
Foreign investing is kind of wild-west stuff for reasons like these. The governing laws are different. The style of annual report bullshit is different. (That’s not to say it’s less bullshitty, just that different cultures present bullshit in different ways.) It is generally more speculative in part because it’s harder to say how a company is doing in another country. I mean, if you’re in the US and you hear that Ford Motor Co. has turned in a crappy year and is laying off workers, well, that wasn’t hard. But if Nissan was boning the beagle financially, you might not see that splattered all over the US financial news. You’d have to make extra effort to keep tabs.
Most times, I think it’s easier and safer to just buy an ETF or CEF (types of mutual funds you can trade on exchanges) to focus on a given sector of foreign investing, but not all my ETF or CEF picks work out well. All of Deb’s do. Thus, if she is feeling it on Hello Kitty, I’ll start watching Sanrio, feeling a little silly for doing so.