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Most U.S. investors have low exposure to foreign stocks. Despite the rising importance of foreign countries in the global economy, many investors have the “home-bias” problem and continue to gravitate towards American companies. While it is true that a quarter of the revenues of the S&P 500 firms come from abroad, in order to gain full exposure to foreign investments, investors have to jump into foreign stocks. In addition, domestic companies in foreign countries know the local market, culture, traditions, etc. and hence have an edge over US firms. Unlike the US, many countries are projected to have stronger economic growth next year and in the future. Hence investors may want to review their portfolios now and change their asset allocations to better position themselves and profit from growth overseas.

There are many advantages in owning foreign stocks. One of them is high dividend payouts. Foreign companies generally pay much higher dividends than US companies. One way to identify some foreign stocks is to select stocks that pay high dividends. Investors can use the following list of high dividend-paying US-traded foreign stocks as a starting point for further research. As 2010 is coming to an end this is also a good time to dump some of the losers in the portfolio and add high-quality foreign stocks.

Some foreign stocks yielding over 5% dividends as of market close December 8, 2010 are listed below:

1.Company: Eni Societa per Azioni (NYSE:E)
Current Dividend Yield: 6.28%
Sector: Oil & Gas
Country: Italy

2.Company: BBVA Banco Frances (NYSE:BFR)
Current Dividend Yield: 5.7%
Sector: Banking
Country: Argentina

3.Company: Westpac Banking Corp (NYSE:WBK)
Current Dividend Yield: 6.84%
Sector: Banking
Country: Australia

4.Company: Australia And New Zealand Banking Group Ltd (OTCPK:ANZBY)
Current Dividend Yield: 6.21%
Sector: Banking
Country: Australia

5.Company: Petrobras Energia (NYSE:PZE)
Current Dividend Yield:
Sector: Oil & Gas
Country: Argentina

6.Company: Telecom Corp Of New Zealand Ltd (NZT)
Current Dividend Yield: 6.51%
Sector: Telecom
Country: New Zealand

7.Company: Philippine Long Distance Telephone Co (NYSE:PHI)
Current Dividend Yield: 6.45%
Sector: Telecom
Country: Philippines

8.Company: E.ON AG (OTCQX:EONGY)
Current Dividend Yield: 6.40%
Sector: Electric Utilities
Country: Germany

9.Company: EDP Energias de Portugal SA (OTCPK:EDPFY)
Current Dividend Yield: 5.72%
Sector: Electric Utilities
Country: Portugal

10.Company: YPF SA (NYSE:YPF)
Current Dividend Yield: 6.93%
Sector: Oil & Gas
Country: Argentina

11.Company: Imperial Tobacco Group PLC (OTCQX:ITYBY)
Current Dividend Yield: 6.46%
Sector: Tobacco
Country: UK

12.Company: Zurich Financial Services (OTC:ZFSVY)
Current Dividend Yield: 6.28%
Sector: Financial Services
Country: Switzerland

13.Company: CPFL Energia S.A (NYSE:CPL)
Current Dividend Yield: 7.74%
Sector: Electric Utilities
Country: Brazil

14.Company: Total (NYSE:TOT)
Current Dividend Yield: 5.96%
Sector: Oil & Gas
Country: France

15.Company: Repsol YPF (REP)
Current Dividend Yield: 5.11%
Sector: Oil & Gas
Country: Spain

16.Company: BCE Inc. (NYSE:BCE)
Current Dividend Yield: 5.21%
Sector: Telecom
Country: Canada

17.Company: France Telecom SA (FTE)
Current Dividend Yield: 7.31%
Sector: Telecom
Country: France

18.Company: GlaxoSmithKline plc (NYSE:GSK)
Current Dividend Yield: 5.16%
Sector: Healthcare
Country: UK

19.Company: Huaneng Power International, Inc. (NYSE:HNP)
Current Dividend Yield: 5.49%
Sector: Electric Utilities
Country: China

20.Company: Companhia Siderurgica Nacional (NYSE:SID)
Current Dividend Yield: 6.94%
Sector:Basic Materials
Country: Brazil

21.Company: Telecomunicacoes de Sao Paulo SA (NYSE:TSP)
Current Dividend Yield: 7.00%
Sector: Telecom
Country: Brazil

22.Company: Chunghwa Telecom Co., Ltd (NYSE:CHT)
Current Dividend Yield: 5.25%
Sector: Telecom
Country: Taiwan

23.Company: RWE AG (OTCPK:RWEOY)
Current Dividend Yield: 7.32%
Sector: Electric Utilities
Country: Germany

24.Company: Telstra Corporation Ltd (OTCPK:TLSYY)
Current Dividend Yield: 9.67%
Sector: Telecom
Country: Australia

Disclosure: Long EONGY

Source: New Year's Resolution? Dump Domestic Losers and Buy High-Dividend Foreign Stocks