Hey everyone. Wow this market is all over the place these days. Now the fed decides to continue raising the rates, and I think we will continue going lower. Who knows though, I’ll just keep making stock buys and enjoy the cheaper drips.
As you can see the site has taken a new look and hopefully is a lot faster for everyone. There is definitely still some hiccups I need to sort out still. ie cloudflare and moving my domain over as well. fun fun. Gtmetrix shows it has been worth my while though as the site loads in around a second where before it took 5-8 seconds. Hopefully google decides to reward me with a higher page rank or something.
While this has been frustrating the last couple days, it will save me in the long run. I dunno how many nights I’ve tried grinding to improve the speed with caching etc to no avail. Hosting is a big factor.
I have known for awhile that I need to even out our portfolio. We currently have about 5-6 holdings that are over 5% of our portfolio. It was a beginner move throwing so much money into certain companies, but some of them have just appreciated so much as well. Id like to lower these positions so they don’t impact my portfolio as much.
Enbridge was a huge mistake of mine. Now I got to back that up and say, I love them. They are a solid dividend growth stock (just raised div 10% again) with a backlog of projects to continue that dividend growth, but when I started investing, I dunno what happened. But I needed a sizeable position in each one of our accounts. It currently is over 10% of our portfolio, but its underwater…. I haven’t sold any yet, but really am debating it. Maybe sell like 5k and move it into Transcanada, but honestly I think Enbridge has a lot more potential. If it pops to $48 again (my avg cost), I’ll definitely lower that position.
Sell, Sell, Sell
I sold 15 shares of my TD bank position, just north of 70 bucks each… I made about 8% since last year plus dividends off the sale. Td was another big holding of mine and the dividend easily buys me another share each quarter so I dropped that down. Financials have become one of my largest sectors in the dividend portfolio. Id love to buy more bns eventually and get that dripping as well, but its time to make my portfolio better.
I sold our entire position in zdy (a bmo etf). I made about 3% in gains and its dividend of like 3% minus management fees… This was a holding in our rrsp account, and I just felt the US market had some great buys in sectors that Canada really lacks.
My final sale was 100 shares of Riocan. Again it was another holding over 5% of my portfolio. Love the company, but didn’t make much off them… lol. I brought in like 1% in capital gains and the dividend (in a yr and a half). I’m now getting over 40 bucks a month in dividends from them, so decided to even my positions out while still dripping a share a month.
I’m long all the stocks I mentioned (other than zdy etf) I just sold them to take a profit, and build a better portfolio. It was a beginner move for sure, but its all good. As I age, I guess I do get a little wiser! Cisco is another position over 5% but that’s there because I’m up 47% on them. Ill keep throwing money at the market to lower that percentage. =)
Alright on to the buys right? Last week I posted my current dividend stock watch list. Clearly I like the financials these days, but decided to really hit up my lower sectors. With their next earnings report coming out, I decided to make a buy before.
I had $1050 from the sale of TD and just over $1100 cash, so we decided to buy 111 shares of Transcontinental. I feel they were just too cheap and are starting to transition their business in the right ways. A dividend growth streak of 16 years, 5 year growth avg of 6.6% and a payout ratio of 30%… Pfft pretty nice numbers, oh yeah a yield on cost of 4.33%. The stock was also over 40% off its 52 week high… While everyone thinks paper is a dying industry, they are diversifying and also posted a earnings beat last week. This purchase adds $93.24 to our forward dividends.
I sold those Riocan shares which gave me $2400 and change. The reit I have really wanted to start a position in has dropped pretty nicely lately. Dream Global REIT is a owner and operator of approximately 10 million square feet of office and mixed-use space in Germany and Austria. A great way to diversify away from Canada without the tax implications. A p/e ratio of 4.8 times and offers a current yield of 6.47%. We bought 197 shares, just enough to get the drip. Sweet this was a great way to replace those riocan shares. A little more money each month, with the added global diversification. This purchase adds $157.67 in forward income.
After the sale of zdy in our rrsp account we bit the bullet and ate the shitty Canadian dollar conversion. I was really debating this, but overall the tsx has really under performed and I dunno if I see the Canadian Dollar bouncing in value at the moment. My mid month each quarter is always our lowest month of dividends and with T, Abbvie and even JNJ (pays last month of quarter) at these prices I thought it would be a good move. We also had about $500 usd from dividends sitting waiting to be deployed.
Now JNJ is a great stock, I just don’t really want to touch it at the moment. I feel lawsuits are going to be coming from everywhere now. Also if these allegations are true we are talking almost 50 years of asbestos knowledge. Asbestos!!! You don’t play round with that. Their consumer confidence is going to get killed… Again they will survive, but with a p/e ratio over 26 I’m in no rush.
So T or Abbvie? Both great stocks at nice prices, great dividend histories too. But Canada’s dividend growth healthcare sector sucks, and its my 2nd lowest sector. I ended up buying 34 shares of Abbvie the other day at basically 84 bucks each. Thinking the fed’s wouldn’t raise rates and we might have a Christmas rally.. Nope! Ahhh well, love the company and seeing all the dividend raises they keep announcing. My Yield on cost is 5.04%. This adds $145.52 in forward dividends.
Well a lot of moves lately. Not always a good thing, when you factor in trading costs. I thinned out or eliminated 3 positions and added 3 new ones. The stocks added to our diversification both globally and in different sectors. The sales eliminated $281.40 in dividends but the new buys will bring in $396.43 per year. Overall I think it was a great move long term.
What are your thoughts on all these moves? Would you thin out your Enbridge position if you were me? or wait a bit? What would you buy?
Hey I’m Rob, creator of Passive Canadian Income.
In 2011 me and my wife had almost $60,000 in debt and a negative $7,000 Net Worth. Through hard work and financial education we paid all that off. Now we are focusing on increasing our Passive Income Streams to make the money work for us. Feel Free to Follow along the Journey by clicking the Social Media links below or subscribing to get notified of new posts on the sidebar.