Dividend Increases

       During the last week, the big banks in Canada started reporting earnings.  Royal Bank ( RY) and Toronto Dominion Bank (TD) announced dividend increases with their earnings.

    TD increases their quarterly dividend by $0.04 per quarter, or $0.16 annually.  TD was paying an annual dividend of $2.04 per share.  So the increase of $0.16 annually represents an increase of 7.843%.

     Royal Bank announced an quarterly dividend increase of $0.02 per quarter, or $0.08 annually.  Royal Bank was paying an annual dividend of $3.16 per share.  So the increase of $0.08 annually represents an increase of 2.53%.

     I own 100 shares each of  RY and TD.  So my annual dividend income increase $16.00 for TD and $8.00 for Royal Bank.  Using a 3.5% yield,  this is equivalent of buying an investment with $685.71 of my own money to get the $24.00.

Disclosure:  Long RY and TD

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.

Covered Call Option in QSR

    During the month of January, I wrote about writing a covered call in QSR.  This covered call expired as the QSR was trading below the strike price of $52.00 at expiration date of Feb 19.  I get to keep the stock and get to keep the option premium.  The annualized return on this covered call was 9.452% annualized or 0.751% for 29 days.  My high interest savings account pays an annual interest of 0.8% right now, which is actually laughable.

     So, I once again decided to write a covered call in QSR.  QSR is the ticker symbol for Restaurant Brands International.  Restaurant Brands International is the parent company that owns Burger King and Tim Hortons.  On February 24, I sold a covered call for $0.50 per contract  at a strike price of $48.00 with an expiration date of March 18, 2016.  So, I received a premium of $39.05 after commissions.

 Summary:

Option Premium including commissions = $39.05
Days to expiration = 24

Return =  $39.05/$4800
            = 0.814%

This represents a return of 0.814% for 24 days.  That is, if the stock is not called away prior to on the option expiration date. 

Annualized Return = .814%/24*365
                               = 12.38%

 I have wrote several covered calls on this stock.

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.

Recent Transactions

   I have held Killiam Properties in both my margin account and TFSA.  On Feb 10, I sold the 115 units of Killiam Properties inside my margin account.  Prior to Jan 2016, Killam Properties was a corporation, which paid a monthly dividend.  This monthly dividend was eligible for the dividend tax credit for Canadians if you are a Canadian citizen.  Killam Properties changed it structure to a REIT, with shareholder approval, to help align itself with other companies in the Real Estate space.  They now pay a distribution.
   I have held this stock for a few years inside the margin account.  The dividend was only raised once , in recent years, as the company seems to be buying a lot of properties due to the low interest rate environment.
   I own units in XDV, which is the iShares Canadian Dividend Select ETF.  As the stock was trading below my cost basis I decided to put money to work.  On Feb 10, I purchased 60 units at a total cost of $1190.61 including commissions.  On Feb 11, I purchased 1 unit of this same ETF at $19.28.  Therefore I now own 300 units of XDV, which pays a monthly distribution.  The commissions consist of ECN fees only as my broker offers commission-free ETFs.

Disclosure:  I own KMP.UN inside TFSA

Disclosure: Long KMP.UN, XDV

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.

Dividend Update - January 2016 NEW RECORD

      The month of January 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 fell all the way down to below $27.  Tensions appear to be brewing between Saudi Arabia and Iran.  This might cause the price of a barrel of crude oil to go down even further in the near future. 

        The low oil prices continue to have an effect on the economy in Western Canada.  Layoffs continue to happen in the energy sector and lots of office space becoming vacant in Calgary.  Calgary is a city in Alberta, that is corporate headquarters for a lot of companies in the energy sector.  People from all over Canada work in the oil field due to the types of shifts available.  Workers fly back and forth to work in the oil patch. 

      One thing for sure, is that I was paid dividends and distributions for being a shareholder or unit holder in  various companies or funds.

 Non-registered Account

• Bell Canada Enterprises (BCE) - $65.00
• Bank of Nova Scotia (BNS) - $21.78
• Enerplus (ERF)  -$ 16.38
• Killam Properties (KMP)  - $5.75
• Restaurant Brands International (QSR) - $17.90 
• Rogers Communications Class B (RCI.B) - $96.00
• Shaw Communications (SJR.B)    - $19.75
• iShares Canadian Select Dividend ETF (XDV)- $39.52 
• TD Bank  (TD) - $51.00

TFSA

• Boston Pizza  Royalties Fund (BPF.UN)   - $25.34
• Claymore 1-5 yr Laddered Corporate Bond ETF (CBO)  - $1.57
• Dream Office REIT   (D.UN)  - $ 25.76
• Killam Properties REIT (KMP.UN) - $  15.00

Total = $400.75

        This total represents a 9.65 % increase from 3 months ago and 57.7% increase  year over year.  The ETFs  XDV and CBO paid twice this month on January 6 and Jan 29.  These 2 ETFs didn't pay in the month of December, which is likely due to the capital gains component of their distributions so they have to wait until Dec 31 to do their calculations.

      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 $1715.47 in distributions so far on this trade.

 
      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 January?

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.