Earlier this year, some of the major finance bloggers like AK (A Singaporean Stocks Investor), Budget Babe and Investment Moats promoted a investment membership named Dividend Machines. Membership was opened for a limited time only till mid March and membership fees for a lifetime basic member was set at a few hundred dollars, which was pretty cheap for a investment course + education platform. It was promoted as a no nonsense, minimal upsell course with real knowledge being taught.
As somebody who was largely self taught, learning a structured method has always appealed to me. At the same time, I’m very much aware that investment courses don’t come cheap (a few Ks minimum) and tend to be full of BS and upsell. So the Dividend Machines course seemed to fit the bill. As the capital outlay was comparatively minimal, I took the plunge and here are my impressions after attending their 1 day course last weekend.
Update 2020: Dividend Machines is currently closed for registration.
What is Dividend Machines?
Dividend Machines is a investment membership developed by the guys at The Fifth Person – Victor Chng and Rusmin Ang – a popular finance blog. Their articles generally cover analyses of Stocks and REITs with a focus on the Singapore, Malaysia and Hong Kong markets (based on me eyeballing their blog). Dividend Machines, as the name suggests, is focused on the income investing approach, whereby the aim is to find stable dividend / distribution growers to invest in and build your passive income.
Membership Platform
A basic membership gives you access to their e-learning materials and forum as well as a 1 day all access workshop. The e-learning materials are essentially videos and a short write-up on the steps and methods to identify strong dividend paying companies and REITs. If you have any questions, you can ask them in the forum and they will attend to your questions. Looking at their forums, I can see that their replies are pretty prompt, usually within the same day of the post.
Locked behind a further paywall is their Professional product, which gives you access to their watchlist (determined using their proprietary method), portfolio, biannual Professional member meetups and live buy / sell calls.
The basic platform is pretty basic (you get what you pay for I suppose ?), but at least you have a way to review the material on your own time if you forget and are able ask any questions you may have or ask for opinions on specific counters.
Workshop
The workshop was conducted by Victor and Rusmin to a room of about 40-50 people. I was slightly surprised at the large proportion of women that turned up. Apparently, it was an anomaly for that particular day. Anyway, Victor covered the dividend stocks portion for the morning and Rusmin covered the S-REITs portion in the afternoon. They went through their proprietary method and stuff they look out for in choosing strong dividend growers and REITs. They also had simple case studies to practise their method and were very much open to any questions you may have. They ended the day with a presentation on the Professional service.
Areas I liked about the course:
1) Beginner friendly
The method proposed is structured in a simple to understand manner for beginners. I particularly like the criteria for REITs as its mostly legit, having done a lot of research recently on how to pick good REITs. I even learnt about some new things like when to enter and exit REITs, which I found interesting. The thing about REITs is that the criteria is generally well documented online, the only thing extra that they did was to package it well into a cohesive, easy to learn way, which I think is useful for new income investors.
The dividend stock methodology generally makes sense, it even has a built in fraud detection step, but it seems overly simplified to me. I will need to test it on my own before I can give a more in depth opinion.
2) Largely no BS marketing or hyperbole
Other than the part of selling their Professional service, there was not much marketing and largely real knowledge was taught. They were quite honest about the amount of effort their method requires you to put in, the expected returns (no outrageous return figures) and the fact that they have lost money despite their best efforts.
That said, they did try to sell the dream of financial freedom with photos of the places they’ve travelled as part of the pitch for their Professional service, implying that their method can also bring you to their lifestyle, which sent my BS meter buzzing.
3) The crazy stories
Victor and Rusmin has certainly done some pretty bold and hilarious things in their personal investment journey and it comes out from time to time in the anecdotes they have to share. Certainly entertainment value there.
Areas of improvement:
1) Accounting and corporate action crash course
There were certain portions of the dividend stock selection process that needed some knowledge of accounting and corporate actions like share splits which they tried to explain very quickly. I’m a accounting professional, so I already know this stuff, but I can only imagine somebody with almost no accounting / investing background going through that part.
That said, trying to cram accounting basics into a 1 day investment course would be a tough sell anyway, so it was kind of understandable.
2) Dated examples and slides
The information and illustrations used were all from when the time they developed the curriculum in 2015 (I assume). As such, it felt a bit irrelevant and harping about your winners. That is not a bad thing per se for educational purposes, but some of the counters talked about are not even listed anymore or have since changed their names.
Conclusion
In my opinion, the basic membership delivers good value for its members. I would recommend new investors to go through their e-learning materials and reading up on basic stock and accounting terms before attending the workshop. There is a certain level of suspension of belief in terms of effectiveness of the method for dividend stocks, maybe because as an accountant it seems overly simplified, but they have disclaimed that the method works most of the time and not all the time (no risk, no return right?), so that’s fine.
With regards to the professional membership, I would say only join if you are slightly lazy and use it as a platform for idea generation and deep discussion. While it’s not the most expensive membership out there, it is still a significant sum of money.
If you are looking for a course with minimal marketing BS and upsell, with real knowledge being taught at a entry level price, this is the course for you. Unfortunately, registration is currently closed. Wait till next year, I suppose?
I look forward to testing their method with my own money going forward.
Update 2020: Dividend Machines is currently closed for registration.
Happy Hunting,
KK
PS This is not a sponsored post. I paid with my own money and my views are my own.