Taiwanese stocks offer high returns, but investors still sell

The cash reward for owning Taiwanese shares is greater than almost anywhere else in Asia. Global investors are abandoning them anyway.

Even with the Taiex reference benchmark close to a record, managers have withdrawn about $ 680 million from Taiwan equity funds this month, more than any other market in the region. Withdrawals occur even as corporate dividends outperform US yields and a record amount of debt generally yields below-zero returns.

Investors who plunged into Taiwan equities earlier this year are not eager to do so again: companies in the economy are so tied to the global supply chain that they are particularly vulnerable to trade war and slowdown of the smartphone market.

"High dividend yields make Taiwanese stocks attractive to global investors in a low interest rate environment, but that's just one of the things to consider," said Agnes Lin, a strategist on Global Markets at JPMorgan Asset Management Taiwan Ltd. The trade disagreement between the US and China also discourages equity investors, she said.

The Taiex measure rose 0.5% at 9:08 am Monday in Taipei.

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