I recently wrote about purchasing 200 units of an ETF. The name of this ETF is the iShares Dow Jones Canadian Select Dividend ETF. As per google finance, so information as to what the ETF consists of is shown below:
iShares Dow Jones Canada Select Dividend Index Fund, formerly iShares
CDN Dow Jones Canada Select Dividend Index Fund, seeks to provide
long-term capital growth by replicating, to the extent possible, the
performance of the Dow Jones Canada Select Dividend Index (the Index)
through investments in the constituent issuers of such Index. The Index
consists of 30 of the highest yielding, dividend-paying companies in the
Dow Jones Canada Total Market Index, as selected by Dow Jones using a
rules-based methodology, including an analysis of dividend growth, yield
and average payout ratio. In the Index, the weight of any one company,
in terms of market capitalization, is limited to 10%. The Fund is
managed by BlackRock Asset Management Canada Limited. ( Source: Google Finance)
I purchased 19 more units of XDV. The 19 units were purchased at $22.05. There was no commissions as my broker has commissioned free ETFs. However, I had to pay some ECN fees as it was not a round lot of units. XDV pays a monthly distribution.
EDIT: I will update my investing tab spreadsheet in early December.
DISCLAIMER
I
am not a financial planner, financial advisor, accountant or tax
attorney. The information on this blog represents my own thoughts and
opinions and should NOT be taken as investment or business advice.
Every
individual should do their due diligence to make their own financial
decisions based on their financial situation and tolerance for risk.
Living in Canada, everyone knows how important the oil industry is not only for Western Canada but for the entire country. As the jobs in the oil industry are high paying, people travel from all parts of Canada to work in the oil patch in western Canada. Canada has conventional oil, which is the involves the drilling rigs. It is said that one rig operating is 135 jobs. These jobs involve working long hours, which is a completely different life from a person who works 8 hours a day and goes home everyday.
Fig 1
Currently with the price of the barrel of crude oil, there has been a lot of layoffs in the oilfield. As the oil field workers maker a lot of money, and at times are paid expenses such as hotels and meals by their employers when they are working. The typical shift is usually 2 weeks on and 6 days off. When the oilfield service workers are traveling to various rigs they often stay in hotels and eat in restaurants regardless if it is a city, a town, or small rural area.
Fig 2.
As you can see from the above chart the drilling rig utilization is way down year over year. The average utilization of 25% has drastic effects on the economies of western Canada. With the massive amount of layoffs comes less traffic on the roads going to and from rigs. This also means other sectors are being effected including hotels and restaurants.
The other type of oil exploration in Canada is the oil sands. This involves no rigs but huge machines digging. The extraction of oil comes through separation the oil from the ground that is dug up. This is done though things such as processing plants.
Events of Last 15 years
Their has been major things that happened in the last 15 years. We had the dot com bubble, the global financial crisis in 2007-2009 and now the low oil prices. These have caused major problems in the financial industry. The financial crisis is the worst recession since the great depression. Currently, we are in living with the low price for a barrel of crude oil. The fall of crude oil prices started in September 2014. We are currently testing the $40.00 a barrel threshold for WTI prices. We have no idea how long this low price environment is going to last. Some analysts predict the price will go down lower while others predict it will be 2020 before we see $80.00 a barrel oil.
What Can A Person Due To Help Themselves?
When a person works at a job they do not have many tax advantages that they can take advantage of. A person needs to save a percentage of their after-tax income by paying themselves first. This pay yourself first concept was popularized in the book called The Richest Man in Babylon. The goal is to grow this money by putting it to work. As the amount grows, a person can buy income producing assets such as stocks that pay dividends, rental properties, bonds etc. The income from these assets are "children" of your investments. Then you put these "children" to work along with new money from paying yourself first to grow your passive income. This will allow your assets and their income to compound exponentially. As first the going is slow, but over time the compounding becomes more noticeable. By creating passive income, a person helps to reduce stress in their life as they have more income from just one source, which is usually from a job. A job is no longer secure. If a person is building their war chest and receives a layoff or gets fired from a job, then they have income to fall back on . The ultimate goal is to have more money coming in from investments than going out to pay expenses. Once the passive income coming in is greater than expenses, then the person is financially free. Imagine, being able to go on vacation whenever you want. While you are on vacation, you do not have to worry about money as your investments are providing you with NEW money. Going on vacation like this is only possible with receiving money from other sources rather than from a job.
DISCLAIMER I
am not a financial planner, financial advisor, accountant or tax
attorney. The information on this blog represents my own thoughts and
opinions and should NOT be taken as investment or business advice.
Every
individual should do their due diligence to make their own financial
decisions based on their financial situation and tolerance for risk.
I recently wrote about writing a covered call in QSR, which you can read about here. The strike price of this call option was $48.00. While holding this position, the price of the stock went up and up, which means the option premium went up as well.
I decided to buy this option back and then sell a new call option with a $52.00 strike price with a Dec 18 expiration date. The price of the stock has fallen back down to just over $47 a share. So I plan to hold this option until expiration. If it is not assigned I will attempt to write another covered call. As I have to pay an assignment fee of $24.95, I look for collecting premiums of $0.46 per contract before commissions.
Disclosure: Long QSR
DISCLAIMER I
am not a financial planner, financial advisor, accountant or tax
attorney. The information on this blog represents my own thoughts and
opinions and should NOT be taken as investment or business advice.
Every
individual should do their due diligence to make their own financial
decisions based on their financial situation and tolerance for risk.
The month of October is another month of dividend income landing in my accounts. This
money is used to help pay my expenses if it is needed. If the money is
not needed, it is ALL used to purchase new investments to further
increase my cash flow.
The price of a barrel of
crude oil is still a major focus of the markets and the economy. Some
analysts are predicting the WTI price of a barrel of crude oil to remain
between $40 to $55 for the next year. At the same time, other analysts
are predicting the WTI price for a barrel of crude oil to be around
$80.00 a barrel. None of us are able to say where the price of oil is
going to be by the end of this year or at the end of the next few years.
Recently in the last few days, President Obama rejected the Keystone XL pipeline that would bring oil from the oil sands to the gulf coast. This topic should play out well in the coming weeks for companies in the oil and gas sector in western Canada.
Non-registered Account
Bank of Nova Scotia (BNS) - $21.54
Bell Canada Enterprises (BCE) - $65.00
Enerplus (ERF) -$ 26.85
Killam Properties (KMP) - $5.75
Restaurants Brands International (RBI) - $7.85
Rogers Communications Class B (RCI.B) - $96.00
Shaw Communications (SJR.B) - $19.75
Toronto Dominion Bank (TD) - $51.00
TFSA
Boston Pizza Royalties Fund (BPF.UN) - $25.34
Claymore 1-5 yr Laddered Corporate Bond (ETF) - $0.77
Cominar REIT (CUF.UN ) - $5.39
Dream Office REIT (D.UN) - $ 25.39
Killam Properties (KMP) - $ 14.85
Total = $365.48
This total is my highest monthly dividend income ever and is the second time I made over $300 in a month from dividend income. This total represents a 19.52% increase from 3 months ago and 48.62% increase year over year.
The RBI dividend is on my prior holding of this stock that I sold. I sold after the ex-dividend date, so therefore I received the payment. I have since bought back into this stock with a bigger position and at a lower price. I plan to write covered calls on this stock as the stock has a very low yield, although still better than a savings account.
I also
received another distribution payment of $56.00 for my swing trade in
Dream Office REIT in my non-registered account. This is not listed above since
it is a trade, so I keep the money in the account and do not pay myself
first with this payment. I have received $1547.47 in distributions so
far on this trade.
Enerplus recently announced their earnings and the board of directors decided to decrease the dividend to $0.03 per share per month down from $0.05 per month. This decrease will start with the December payment. Enerplus is an oil and gas producer in Canada and the United States. The low price of a barrel of crude and what natural gas is trading at these days is drastically affecting the profitability of this company.
I will update my dividend income tab
with the new amount. It is great to see money from passive income
sources deposited into my brokerage account every single month.
How was your dividend income for October?
Disclosure : Long all securities above.
Photo Credit: www.mipaq,co.za
DISCLAIMER I
am not a financial planner, financial advisor, accountant or tax
attorney. The information on this blog represents my own thoughts and
opinions and should NOT be taken as investment or business advice.
Every
individual should do their due diligence to make their own financial
decisions based on their financial situation and tolerance for risk.
The month of October was an interesting month. The federal election in Canada came to a close on October 19. As Canada is a big country across multiple time zones, the polls close in the Atlantic provinces while the polls from Quebec out to British Columbia have their polls still open. So the results of the Atlantic provinces start coming in. The downside to this is people, who vote towards the end of election day, can be persuaded to vote for a particular party they want in over another party. The liberal picked up all 32 seats in Atlantic Canada. Quebec and Ontario was next to close their polls and starting counting the ballots. It started to look like the liberals were favored to win and therefore the government would be changing hands. The Conservatives had a strong backing in western Canada, and still picked up a lot of seats.
The liberals ended up with a majority government. What does this have to do with investing? During the election, the liberals put out a platform just like all parties do. This shows us what the government plans to do with our tax dollars while in office. If taxes get raised this will effect businesses investing in a certain jurisdiction. The NDP government of Alberta released its first budget last week, which was after the federal election. The Alberta election was on May 5 2015.
A big oil and gas company, Royal Dutch Shell took action immediately took action after the Alberta NDP budget was released. Click the following video to find out what exactly Royal Dutch Shell did.(Source: Rebel Media)
I wrote recently about selling a put option in Telus Communications, which you can read about here. This put option had an October 16 expiration date and was not assigned. I get to keep the premium that was paid to me for selling the option. My return for 16 days was 1.036%.
I wrote about selling my position in Just Energy, which you can read about here. I came out of this position with a profit. The price of the stock is still up over $9.00 on the Toronto Stock Exchange. A private equity investment company is buying up a lot of shares still. This investment company is owned by Ron Joyce, who was the cofounder of Tim Hortons. Tim Hortons was sold to Wendy's Restaurants and Ron Joyce became the largest shareholder of Wendys at the time. Eventually Wendy's departed with Tim Hortons and became its own Canadian corporation again. Burger King eventually bought Tim Hortons and formed a new company called Restaurant Brands International which I currently own.
On October 14, I purchased 100 shares of Restaurant Brands International, RBI, on the Toronto Stock Exchange. This investment is the lowest I have paid for shares of this newly formed entity. After seeing some weakness in the share price, I sold a covered call to collect a premium of $99.05 after commissions. The stock has gone a lot higher then the strike price of the option. So I am watching to see if the price of the option falls. If the price of the option falls, I might buy back the option and then sell the stock which will be higher than my gain from the option being assigned.
On October 26, I entered a trade by purchasing 200 units of XDV, the iShares Canadian Dividend Select ETF. My brokerage offers this ETF has commissions free. My entry price is $22.49. I have a GTC order in to sell this. XDV pays a monthly distribution, which I will collect while waiting for my sell order to be filled.
Shares added due to drip
3 shares of ERF @ $7.735 for a total of $23.21
1 share of KMP @ $10.00 for a total of $10.22 inside TFSA
I will also acquire more shares of Scotia Bank, which I own through the transfer agent. This is a full drip. I received the dividend of $21.54 last week. It usually takes 3 to 7 business days to find out the amount of new shares and at what price they are acquired at.
As
of Nov 1 of 2015, the value of my portfolio stands at $81984.24. This is
an increase of 4.253%
over last month. I will
update my investing account tab above.
Disclosure: Long KMP, ERF, RBI
DISCLAIMER
I
am not a financial planner, financial advisor, accountant or tax
attorney. The information on this blog represents my own thoughts and
opinions and should be NOT taken as investment or business advice.
Every
individual should do their due diligence to make their own financial
decisions based on their financial situation and tolerance for risk
