Tuesday, May 31, 2016

My May 2016 Dividend Income Summary : $RY $VSB $VZ $CUF.UN

Hey Personal Financial Freaks! This is my fifth Dividend Income Summary for 2016. 

As you can see on my Passive Income page, only 4 companies chipped in for this month. May is a slow month, what can I say.  Money coming in is... well it's money!

So although May is a quiet month I still managed to collect 160.71$

The amounts are all in Canadian dollars. 

My Dividends came from:

               REIT Cominar (CUF.UN) : 24.75$ (I used to buy one more unit with my DRIP @17.31$);

              Vanguard Canadian Short-Term Bond Index ETF (VSB) : 13.02$ (A new comer that I like and that will provide me with a steady and safe dividend income stream. This number will grow as I intend to increase my position over time in VSB. Remember my 15-20% bond strategy?)

              Verizon (VZ) : 17.64$ (One of those stocks I wish I had more.. I will if the stock price goes  down and the Canadian dollar goes up!...)

             Royal Bank of Canada (RY) : 105.30$. (My biggest financial position. A keeper.)

My total Dividend paid for 2016 :  250.47$ + 256.52$+531.59$+313.70$+160.71$  = 1512.99$

Total Dividend paid since I started Investing : 17 994.22$+160.71$ = 18 154.93$

What do you think of my dividend income stream?

Friday, April 29, 2016

*** Modified: April 2016 Dividend Income Summary : $CP $CUF.UN $MDLZ $KHC $ATD.B $BCE $BNS $PWF $VZ

Hey Personal Financial Freaks! This is my fourth Dividend Income Summary for 2016. 

As you can see on my Passive Income page, 9 companies chipped in for this month.  

In April, I managed to collect 313.70$. Not a great amount, but not too shabby either

The amounts are all in Canadian dollars. 

My Dividends came from:

                REIT Cominar (CUF.UN) : 24.62$ (which I use in part to buy one more unit @ 17.20 with my DRIP);

                Canadian Pacific (CP) : 17.50$ (CP has become a top holding for me due to the rise of the stock over the past 5 years. Thanks to Bill Ackman and Hunter Harrison. They recently just raised their dividend after a 2-3 years interruption. It's a keeper.) 

                Mondelez (MDLZ) : 23.05$ (MDLZ's price stock has grown quite a bit. But not the dividend. Will see how it goes. Could be a potential buy like Kraft).

                Kraft Heinz (KHC) : 31.98$ (Mature stock. Now in the hands of Warren Buffet. Buy and hold like the master and see how it does in 20 years)

                Alimentation Couche-Tard (ATD.B) : 8.10$ (Not a dividend player just yet. But wait and see. Remember, you read it here first!).

                BCE (BCE): 27.30$. (Year after year, BCE show strong results and hike its dividend. What's not to like? I wish I had some more.)

                Bank of Nova Scotia (BNS) : 108$ (Yes, that's mighty impressive! BNS is now a top holding. I used this money in part to buy one more share@ 65$ with my DRIP)

                Power Financial (PWF) : 39.25$ (PWF is such a diversified stock : insurance, financials, name it. One of the cheapest stocks, most conservatively and well-managed company out there. What are you waiting for?).

                TransCanada Corp (TRP) : 33.90$ (I don't own TRP anymore. I still think it's a great stock but between TRP and ENB I had the latter with a slight advantage. Hence TRP not making the cut no more. Remember, I don't want to hold more than 20 individual stocks!)

My total Dividend paid for 2016 :  250.47$ + 256.52$+531.59$+313.70$  = 1352.28$

Total Dividend paid since I started Investing : 17 680.52$+313.70$ = 17 994.22$

What do you think of my dividend income stream?

Friday, April 15, 2016

A glimpse of my new Hybrid Strategy

Hey Financial Freaks,

I hope all is we'll for you guys. I've been quite busy lately working, saving and doing a little bit of investing. And no... I haven't developed any kind of "strange obsession" with anyone as of late -- well since forever I might add.  (don't get me started!)  ;-)

I have been tweaking my investing strategy though.

Like I've hinted in the past, I have made a few moves to developed a mix strategy between a dividend growth and a Index one. I know some of you are already doing this. Congrats! I also know some of you will be sticking forever with the same strategy, namely a Dividend stocks approach. Both strategies are sound in my opinion. This is why I picked both!

Like I said numerous times in the past, I don't have time (nor the passion) to monitor closely more than 20 stocks. Heck, I barely find the time to do 20 push-ups... So I thought about allowing a certain percentage of my portfolio to Index Investing. This meant I would also cut on the number of stocks I would hold since I had 22 as of late. I say "had" because I now hold only 17 individual stocks.

Since the beginning of the year, I have made more than 26 transactions. This is a lot, I know. If you do you share of reading, you probably know that when it comes to investing the less you do is the better. But I had some tweaking to do and I thought that I would be better off doing this after a 7 years bull Market than before all Hell break loose. Call it Market Timing if you want. I call it necessary changes.

All the 13 buys I have made since January 2016 have been in stocks I still hold today and will be holding for a long time.

My new Big Five holding consists of : Johnson and Johnson (JNJ), Power Corp, (POW) Bank of Nova Scotia (BNS), Royal Bank (RY) and Canadian Pacific (CP). 

Unfortunately (or fortunately in some cases), I had to let go of some companies.

I said goodbye to : Transcanada Corp (sadly, but I prefer Enbridge), Barrick Gold (good frickin' riddance!), Suncor (only sold some shares in my RRSP), COP (dividend cut = adios muchacho and thanks for the good memories), PJC.A (short-term intense romance) and POT (second time around wasn't a charm after all).

That leaves me with 17 stocks. (I will try to never hold more than 20).

Finances (4) : Power Corp, Financial Corp, Bank of Nova Scotia, Royal Bank.
Industrials (2) : Canadian National Railway, Canadian Pacific Railway.
Consumer Staple (3) : Kraft Heinz, Mondelez, Alimentation Couche-Tard
Energy (4) : Suncor, Enbridge, ATCO, Fortis.
Telecom (2) : BCE, Verizon.
Healthcare (1) : Johnson and Johnson.
REIT (1) : Cominar.

I also purchased some new Index Funds:

  • Vanguard Canada All Cap Index ETF (VCN);
  • Vanguard FTSE Developed All Cap ex North America (VIU);
  • And Vanguard short-term Canadian Bonds (VSB).

Check out my leaner portfolio here.

I also still hold two Index Funds from RBC. These funds enable me to purchase on a regular basis shares of the funds without commission.  So, twice a month, I buy new shares without really care if the Market is up or down. Eventually I will sell parts of these funds to buy new shares of my Vanguard's funds.

I find that the most important aspect of my strategy will be the balancing between my bonds % and my stocks %. This is key. Right now I have set this balance to 80-20 in favour of stocks, of course.

This means that, once or twice a year, depending on how the Market performed, I will rebalance everything.

Say, for instance, the Market had a poor year and my balance is now 65-35. This means I would only have to sell shares of my bond funds and allocate new capital to my stock funds (or my individual stocks). I could also simply allocate new capital to my stock funds to find my initial balance.

Or for instance, say the Market has performed too well and my allocation is now 95-5. Well I would then sell some shares of my stock funds and allocate the new capital money towards bonds. Simple as that!

Right now, I hold more cash than normal. I might add a Vanguard US Fund in the coming months. Not sure which one. I'm hesitating between a US currency one and a Canadian one.

But you get the gist of my strategy. It's very simple. The bonds simply act as a security cushion that enables me to balance my portfolio.

Eventually, stocks wise, I would like to get a parity between my individual stocks % allocation and my Index Funds % allocation. This means, most of my coming buys will be in my new funds. However, I swill till keep money aside to grow my actual  individual stock holdings if opportunities arise. (Like Verizon)

I realized this is a bit of a long post. I will shares my other thoughts on this new approach in coming weeks. Stay tune.

Meanwhile, let me know what you think. How do you like this hybrid strategy ? It is too passive for you?















Friday, April 1, 2016

My March 2016 Dividend Income Summary : $JNJ $ACO.X $POW $ENB $CNR $FTS $COP $SU $CUF.UN $ABX

Hey Personal Financial Freaks! This is my third Dividend Income Summary for 2016. 

As you can see on my Passive Income page, a whopping 10 companies chipped in for this month.  

In March, I managed to collect 531.59$. This is the first time, if I'm correct, that I have reached the 500$/month milestone. Shots for everybody!

The amounts are all in Canadian dollars. 

My Dividends came from:

                REIT Cominar (CUF.UN) : 31.48$ (which I use in part to buy one more unit with my DRIP);

                ATCO (ACO.X) : 57.00$ (ATCO is now a top holding for me.)

                Power Corp. (POW) : 93.38$ (POW remains one of my big 6).

                Barrick Gold (ABX) : 3.96$ (My most hated stock. Only 100 shares remaining...).

                Enbridge (ENB) : 53.00$ (A new addition to my portfolio and a keeper for the long term).

                Conoco Philipps (COP) : 16.85$. (COP and I parted ways recently. It was a minor holding)

                Fortis (FTS) : 47.25$ (which I use in part to buy one more share with my DRIP).

               Johnson and Johnson (JNJ) : 129.92$ (The king of Kings).

              Suncor (SU) : 72.50$ (SU isn't part of my big 6 anymore, it's still a force to be reckon with.)

             Canadian National Railway (CNR) : 26.25$. (I love trains, what can I say!)

My total Dividend paid for 2016 :  250.47$ + 256.52$+531.59$ = 1038.58$

Total Dividend paid since I started Investing : 17 148.93$+531.59$ = 17 680.52$

What do you think of my dividend income stream?

Wednesday, March 9, 2016

The temptation of Index Investing

As you may have noticed on my Portfolio page, I hold an Index Fund. It's a RBC US Index Fund with fees of 0,70%. If you browse a little bit on the Web you can find US Index Fund much cheaper. For example, the Vanguard US Total Market Index ETF (VUN) has fee as low as 0,15%. 

As experienced investor, we all know that small percentage have huge effets over a long period of time. Right now, I stick with my RBC Index Fund simply because it enables me to purchase shares on a regular basis at no cost. That's where lies the advantage. For now.

You all know by now, I don't want to hold too many stocks. The reason : I don't have time nor the passion to closely follow more than 15-18 stocks. (even that number is outrageous. I have to work for a living, work out, eat, etc.) I now hold 22 stocks. I know, that's insane, Check it out here. I doubt that most of you can follow more than 20 stocks, unless you are still living in the basement of your parents. If it' the case, you might have other worries than following stocks...  (just joking).

So how did I end up with 22 stocks? Basically greed and the fact that I'm a man and therefore I think I'm the king of stocks. I most certainly aren't. I have many stock stories that went sour and could confirm this. ABX get out of my body!!!

I believe the less you do while managing your portfolio, the better it will fare over time. We are always tempted to diversify, buy this new attracting stock or add some of this and some of that to average down our cost. By the end of the month and the years these commissions pile up and eat up our performance. (yes it does)

Where am I getting at? I guess I'm getting at Index Investing.

I've been thinking about Index Investing for a while. But never got my head around it. I think I might consider this option starting this year. Will I sell my actual stocks? I might get rid of some of them (POT, COP, ABX...) but I will keep the others. I sure won't touch to my main holdings, namely JNJ, BNS, RY, POW, etc.

I 'm thinking more of developing an hybrid approach. I would  keep roughly 16-18 stocks and would add 3 or 4 index funds. It's in these funds that I would inject new money. Once a month or every quarter. Then I would rebalance the whole thing just once a year to match my initial strategy.

This initial Index strategy could resemble this :

  • 35% Vanguard Canada All Cap Index ETF (VCN) | MER = 0,11%
  • 35% Vanguard US Total Market Index ETF (VUN) | MER =0,16%
  • 20% Vanguard FTSE Developed All Cap ex North America (VIU) | MER = 0,20%
  • 10% Vanguard FTSE Emerging Market All Cap Index (VEE) | MER = 0,29%

Just that simple. Actually, back in the days I should probably have opted for this sort of strategy right away. Any Millenials listening out there?

All in all, the management fees would represent an average total of 0,19%. Not bad to hold pretty much the entire world of stocks!

This is indeed a Couch potato strategy. You won't beat the Market for sure. But you will do just as well. And that's much better than a whole lot of active managers.

So I'm thinking more and more about making this move. Will see how it goes. Stay tune.

What do you think about this move? Should I do this? And would you consider doing some Index Investing?




Saturday, March 5, 2016

Why I sold some $BNS and some $SU

Hey Financial Freaks,

Well, yeah, my first two moves of March consisted of selling small portions of two of my main holdings : Suncor (SU) and Bank of Nova Scotia (BNS).

This is a rare move on my part since I am (or pretend to be) a buy and hold investor. I still think the best way to make money is too hardly make any moves at all -- apart from b
uying obviously.

This is why I feel I have to justify these two moves.

First, Suncor (SU).

This is a stock I have been holding for more than 5 years, never minding all the ups and downs. Suncor is the best old integrated company in Canada. But I, like most oil investors, remain cautious about the present situation. This sector is clearly facing headwinds. It remains too see if the company can maintain its current dividend policy. The stock is now yielding at 3,44%. This is pretty high considering other peer companies have had to slash their dividends. Another question mark : will the acquisition of Canadian Oil Sands put the dividend in jeopardy? Maybe.

Last month, I bought 30 shares of SU at around 27$ I was then trying to average-down my cost-price. It worked. Recently, the share price went back up (around 34$). This stock then crossed the 5% weight in my portfolio next to other big names like Royal Bank (RY), Johnson and Johnson (JNJ) and Power Corporation (POW). Given the current state of oil prices, I thought it would be wiser, especially in my RRSP, to diminish a little bit my exposition to oil.

This is why I decided to sell 25 shares of SU at 33,85$. This adds 836$ for other buys. It also means I have to withdraw (25 X 1.16$) 29$ in dividends from my Passive Income.

I still hold 225 shares of Suncor. This stock accounts to more than 4,67% of my portfolio.

Second, Bank of Nova Scotia (BNS).

This is purely a move meant as rebalancing my portfolio as well as my exposition to the financial sector in general.

I sold 20 shares of BNS at 59$, so at approximatively my cost-average price. This provides me with 1 169$ for other buys. It also means I have to withdraw (20 X 2.88$) 57,60$ in dividends from my Passive Income.

Like I said, I still very much like this stock. It remains part of my big five. I just felt I held too many shares and the weight vs my portfolio was too great at 6%. How did I get to 6%? I kept buying and buying as the stock was dropping to average down my cost. I ended up owning 170 shares worth more than 10K$!

I now hold 150 shares of Bank of Nova Scotia and I intend to keep them for a long time. This stock accounts to more than 5,49% of my portfolio.

What do you think about my move? Was I too cautious ? Should I have been more patient even though the stocks represented big chunks of my portfolio? Hit me with your best shots if you think I was a fool. I can take it ! ;-)




Monday, February 29, 2016

My February 2016 Dividend Income Summary : $RY $POT $PWF $PJC.A $VZ $CUF.UN

Hey Personal Financial Freaks! This is my second Dividend Income Summary for 2016. 

As you can see on my Passive Income page, 6 companies chipped in for this month.  

In February, I managed to collect 256.52$The amounts are all in Canadian dollars. 

My Dividends came from:

                REIT Cominar (CUF.UN) : 31.24$ (which I use in part to buy two more units with my DRIP at 14.55$ each);

                Potash Corp (POT) : 54.62$ (this is my first dividend from POT and the last one at this price; they decided to cut their dividend.)

                Jean Coutu Group (PJC.A) : 11.00$ (I might keep this stock longer than expected.)

                Royal Bank of Canada (RY) : 102.70$ (It's RY, need I say more?).

                Power Financial (PWF) : 37.25$ (Slowly but steady).

                Verizon (VZ): 19.71$. (I want more Verizon!).


My total Dividend paid for 2016 :  250.47$ + 256.52$ = 506.99$

Total Dividend paid since I started Investing : 16 895.41$+256.52$ = 17 148.93$

What do you think of my dividend income stream?

Wednesday, February 24, 2016

I bought 10 shares of Canadian Pacific Railway $CP

Today I bought some more shares of Canadian Pacific Railway (CP). 

I bought 10 shares at 162.24$ for a total of 1 622.40$

I now own 50 shares of CP. With an annual dividend of 1.40$ it gives me 70$ in dividend per year.

Needless to say, this stock is lagging a little bit in terms of its dividend, which hasn't been increased since 2012 and is now yielding under 1%. That's very low and unusual for a Dividend Investor like me. It's also a reason why a lot of investors (especially in the bloggers community) have shy away from this particular stock.

But they shouldn't! There are many reasons why this stock weights more than 5% in my portfolio.

The low yield is mostly due to the share going up drastically since the arrival of activist investor Bill Hackman and new CEO Hunter Harrison. It went as high as 250$ (and more). Currently, since the beginning of the year, it took a 30% drop...

I originally bought the stock in 2011 around 56$... I bought 100 shares back then. It just gives you an idea how much the share price has rocketed over the last few years.

I was a fool for selling more than 60% along the way. My stake in CP would be well over 16K$ by now...(oh well, let's move on...)

At the time, the dividend yield was pretty much the same as its competitor Canadian National Railway (CNR). It's not the same anymore obviously. CNR has been increasing its dividend, while CP hasn't and its share has gone up the ceiling.

Right now, CP is still focusing on its merger with Norfolk. One has to presume it is keeping its cashflow for this purpose (although they have had a strong shares buyback policy as of late).

I'm confident in the capabilities of its CEO to create wealth for the CP shareholders in the future. He has done so with CNR and is currently putting CP in a good spot to replicate his past success.

Are you an investor-fan of trains? If so, do you hold CP or CNR?



Monday, February 22, 2016

Diversifying my dividend income ($BNS $RY $JNJ $CUF.UN $SU)

Hello Financial Freaks,

Like most of you guys (or maybe not), I intend to live off at some point from the dividend I make from my investments. It may not represent all of my future revenue but I would like it to be a good chunk. I have no idea how much yet. But since you like datas so much I will give you this percentage: 40 %. That seems about right (yes it does!).

What I do know for sure is where that amount, currently less than 5 K$ (you can check it out here), is mostly coming from.

I hold 22 individual stocks at the moment. All of them pay dividends. But the amounts they pay vary a lot from one company to the other. Not everything is equal when you compare Barrick Gold to Johnson and Johnson or Couche-Tard to Royal Bank of Canada.

Right now I am invested in different sectors of activities : financials, energy, utilities, consumer staple, basic materials, REIT, healthcare, telecom, bonds, etc. (You got more? No you don't!)

The number of holdings and the variety of sectors contribute to my portfolio being well diversified. Is it true in reality ? Or are we talking about diworsifiction as Peter Lynch would put it?

Knowledgeable people have said that you can attain diversification with less than 10 stocks. I believe it to be true.

Take for instance one of my favorite stock, Power Corporation. When you buy POW you buy shares in an already diversified company : you are de facto invested in insurance, financials, energy (through Pargersa which holds Total), booze! (through Pargersa which holds Pernod Ricard) and so on.

Bottom line is : you think you invest only in Canada through Great-West or Mackenzie Placements, you are in fact also investing in Irish Life, Putnam USA and Sagard Investment in China, amongst other things. (aren't you happy about that?)

Same goes for other very well diversified companies like Johnson and Johnson, Couche-Tard or ATCO, to name a few.

If it's important to be diversified regarding your stocks and the sectors they are operating in, it's also very important to find out where your hard earned dividend money is coming from. Because if a stock you own contribute to more than, say, 50% of your dividend income and it goes kaput, it won't matter how many stocks you own because your revenue will still be cut in half. 

For now, it's fine you can easily cope with it as you build yup portfolio. But what about when you are past your prime and are on a travel spree across the World? I guess it's all common sense to think about diversifying your revenue, but in the heat of building your portfolio (finding cheap and great stocks) it might be something that goes unnoticed. 

Some say you should hold a stock that weights more than 5% of your portfolio. I find that rule a little rigid. On the other hand, I would be very wary of owning a stock that contributes to more than 15% of my dividend (unless its JNJ!). 

Right now, 6 stocks contribute to close to 50% of all my dividends. Here are the culprits as seen on my Side Income page:

 

You will agree that, although 50% is quite high for only 6 of my 22 holdings, it still remain a big number. It these 6 companies have a fallout I might get a real cut down on my paycheque. So I will have to keep a close watch on this. 

I've recently compiled a more detailed chart about where exactly, sectors wise, my dividend were coming from. This easy to consult tool will help me diversify my holdings especially according to where my dividends are coming. Here it is :



Needless to say, the Financial sector has the upper hand. And you don't need to be a rocket scientist to conclude that I will need to add a few more shares from the Telecom sector and Consumer Staple sector. My Energy and Financial sectors respectively contribute to already 30 and 15% of all my dividend. 

What does it tell me about my holdings? Well, it tells me for instance, that a sector like Industrial tend to pay less dividend than the Financial Sector. Should I then hold more shares of Canadian Pacific and Canadian National Railways to make it up? Not sure. 

I guess it's normal to have a bigger portion of my dividend coming from the big banks. It's the way it goes. But, like I said, I should definitely try to lower that percentage by increasing my dividends coming in from other sectors. 

I will therefore keep a close watch on $BCE (Telecom) and try to boost the dividends coming from the Consumer Staple sector. I don't know if it's a trend, but I find Mondelez, Kraft and Couche-Tard to be quite conservative on their dividend policy. Maybe I should add another player. Anyone in mind? (aside from all the big US names such as Coke and Pepsi, which are great, but too expensive at the moment).

What do you think about the diversification of my dividend income stream? Any idea or tips for me?






Friday, February 12, 2016

Latest buys : $CNR $BNS $ATD.B

February has been quite poor Market wise and it generaly means it's been good buy wise. I can't say that I have been doing big buys but I kept the nibbling machine on. Not full blast, but nevertheless on.

Let's take a look at what I did with my investing money :

I have expressed many times on this blog my love for trains. I own both Canadian Pacific (CP) and Canadian National Railways (CNR).

These companies have both been affected by the Market dips recently. It was a great time to get my hands on usually expensive shares of CNR. I already own CP and I won't add new shares until they start growing their dividend a little bit. It seems like they need their money right now to buy Norfolk. Will see how this goes. It's like a snake trying to eat an elephant... For now, I concentrated my time and energy on buying some more of CNR, its main competitor in Canada.

On January 26, Canadian National Railway raised its quaterly dividend to 0.375$. It represented a 20% increase. The dividend yield is still low at a little less than 2%, but the management team have been quite constant in their dividend raises. I am confident they will keep doing so in the future.

  • So, I have recently added 10 shares of CNR at 66.98% for a total of 669.80$ . This adds 11.50$ in dividend to my passive income. I now hold 70 shares of Canadian National Railway and I'd like to hold a 100 shares. So this stock remains on my target list. Unfortunately, I wasn't able to buy some more because that's all the money I had in this particular account. Hence the small buy.
  • I also bought some Bank of Nova Scotia. (again) How much of something good can you have? I guess a lot. I bought 19 shares at 53.55$ for a total of 1017.45$ This adds 43.20$ in dividend to my passive income. I now hold 170 shares of BNS and it's now my biggest financial holding with a weight of almost 6% in my entire portfolio. 

  • Finally, I bought shares of Alimentation Couche-Tard (ATD.B) twice. I bought 40 shares at a price average-cost of 56.83$ This adds 10.80$ in dividend to my passive income. I know this stock is not a dividend growth stock like most ones I hold and it's not very popular among the DGI community either.  My take on this one is simple : would you rather get on the wagon now, while the dividend is low and the stock price affordable, or when the dividend is fat but the stock price is way too high? I have big hopes in this winner. 

So that's it for now. Let me just tell you what I have in mind if Mr. Market keeps going down:
  • I have my eyes on buying yet again either some more Power Corporation or Power Financial (POW and PWF). If one of them goes below more that 5% of my cost-average price of respectively 26$ and 30$ I will move. I will say it once again : these stocks are super cheap.
  • CNR is still on my radar. If it goes below 70$ I will be extremely tempted.
  • I am thinking about selling my TransCanada Corp (TRP) shares to buy some more Endbridge (ENB). Same with my Jean-Coutu shares (PJC.A). Will see how it goes. I would like to own no more than 20 stocks.

What do you think about my buys and my immediate plans? I would like to hear about you guys.