Recent Buy

I had a cash position inside my TFSA, and decided to put the cash to work.  It is difficult to find opportunities on the Canadian markets.  The Canadian markets have a lot of energy companies, so I avoided any of these companies due to the low price of barrel of crude oil.

So, on July 27, I purchased 94 units of the HNY, which is the Horizon Natural Gas Yield ETF.  I have owned this ETF recently also.  My brokerage offers commission free ETFs.  So I made 2 trades to collect a total of 94 units at an average price of $15.848 for a total of $1490.07.  There is no commission charged for the buy transaction, but there are ECN fees of $0.33.

This is the Horizon Natural Gas Yield ETF.  The summary of the ETF, as per Yahoo Finance, is described below. 

      The investment seeks to achieve its investment objectives by gaining exposure to a portfolio of securities and other instruments that provide exposure to the price of natural gas futures contracts, or exchange traded funds that are directly or indirectly only exposed to natural gas and/or natural gas options, forwards and futures contracts on natural gas by entering into a forward purchase and sale agreement with the Bank Counter party pursuant to which it will gain exposure to the Natural Gas Portfolio. The Natural Gas Portfolio is comprised primarily of exchange-traded funds, which may or may not be managed by the Manager or its affiliates, that are directly, or indirectly, and only, exposed to natural gas or natural gas futures，and will include natural gas futures, financial swaps and total return swaps - Yahoo Finance

This ETF pays a monthly distribution and the amount of the distribution varies each and every month. July 27 is the ex-dividend date, so I will not receive the distribution payment in about 10 days time.

Disclosure: Long HNY

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.

Option Trade

     July 15 was option expiration day for 2 of options that I had on.  One was a short put in Potash Corporation with a $21 strike price.  The second option was a covered call in Royal Bank with a strike price of $80.  The short put in Potash Corporation expired worthless. The covered call option in Royal Bank was assigned.

     As I believe Royal Bank is a well run company, I sold a put option with a $79.00 strike price and expiration date of July 29, 2016.  I collected a premium of $44.05 after commissions.  The duration of this trade is 11 days.

Summary of New Trade

Strike Price:  $79.00
Premium collected after commissions:  $44.05
Days to expiration :  11
Option Assignment Fee : $24.95

Scenario #1  -  Option not assigned 

Return  for 11 days =  $44.05 / $7900
                                = 0.558% 

This return of 0.558% is for ONLY 11 days.  Currently, the interest rate on my high interest savings account is 0.80% per year. 

Annualized Return:  ($44.05 / $7900) *365/11
                               = 18.50%

Scenario #2:   Option Assignment

Adjusted Cost Basis = $7900  - $44.05 +$24.95
                                    = $7880. 90

Current Annual Dividend = $3.24 per share

Yield = $3.24/(7880.90/100)
          = 4.111%
 

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.

Trading Account Update

As previously stated on this blog, that I have started a trading account with a balance below $1000.00.   I started to add $50.00 every two weeks but that has stopped due to a recent job loss.  The following table shows my stats from the start of 2016:

                                # of trades :                 18
                               Total Capital added:    $250.00
                               Trading Acct Balance:  $ 1989.88
                               Average Drawdown:   $28.31
                               Average Loss:             $35.18
                               Average Accuracy:     88.89%
                               Average Risk:              $33.36
                               Average Reward:         $63.47
                               Average R/R :             1: 1.902

     
       I have been trading penny stocks, stocks, REITS and options.  Any dividends that will be received from this account with stay within the account.

Note:  The trades are listed under the Trading Tab above with all the trades listed as of July 10, 2016

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.

Option Trade - Covered Call

       The markets have dropped during the early morning today over rising fears of the fallout from Brexit.   Britain voted in favor of exiting the European Union recently.  Investors and traders have to consider how this will affect businesses, international trade, commodities, and economies around the world.

       On July 6, I wrote a covered call in TD Bank with a strike price of $56.50 and collected a premium of $12.05 after commissions.  This is not a large sum but is income none the less. The amount of days to expiration is 23.  Sure, I could of collected a larger premium if the stock price rose after falling.

       The stock goes ex-dividend July 6  and a dividend payment date of July 31.  Since I already own the stock, I receive this dividend.  The annual dividend rate is $2.20 per share.  So since I own 100 shares of stock I will receive a dividend payment of $55.00.

Summary:

Strike Price:  $56.50
Days to Expiration = 23
Premium Received = $12.05 after commissions

Return for 23 days = $12.05/$5600
                               =  0.215%

Return Annualized = ($12.05/$5600) *(365/23)
                                = 3.415%

An annualized return of 3.415% is definitely higher than a interest received on a high interest savings account.

Note: For my broker, there is an option assignment fee for an option to be assigned or exercised.  This option assignment fee is $24.95


Disclosure: Long 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.

Dividend Update - June 2016

      The month of June 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.

       During the month of July, the markets were strongly impacted due to the referendum over weither Britain would exit the European Union.  The days leading up to the vote, the markets were relatively quiet.  The vote was on a Thursday. The day after the vote, in which Britain voted to leave the European Union, the markets dropped by a lot.

      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

• Enerplus (ERF)  -$ 5.58
• Enbridge (ENB) - $8.22
• Shaw Communications (SJR.B)    - $19.75

TFSA

• Boston Pizza  Royalties Fund (BPF.UN)   - $26.91
• Claymore 1-5 yr Laddered Corporate Bond ETF (CBO)  - $0.69
• CN Rail  (CNR) - $14.25
• Cominar REIT (CUF.UN ) - $5.39
• Dream Office REIT   (D.UN)  - $ 17.50
• Enbridge (ENB) - $17.49
• Killam Properties REIT (KMP.UN) - $  15.10
• Horizons Natural Gas Yield ETF - $3.51

Total = $134.39

        This total represents a 19.62% decrease from 3 months ago and 42.37% decrease year over year. The 3 month decrease was largely a result of Enerplus cutting its dividend and selling of 300 units of the XDV ETF.  The year or year decrease was due to selling Just Energy and Enerplus cuts its dividend over the last year. Enerplus is a company involved in the producing of oil and natural gas.

      I also received another distribution payment of $37.50 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 $1921.47 in distributions so far on this trade.  Dream REIT has reduced the amount of distribution they pay monthly which was announced in February.

     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 June?

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.

Portfolio Update - June 2016

      The month of June 2016 is now behind us.  During the month, the Fort McMurray area of Alberta started its rebuild.  There are workers on the ground doing the cleanup to start rebuilding the houses and businesses destroyed by the fire.  The Fort McMurray airport was also back in operation.

      Towards the end of the month, the results of the referendum means the Britian is leaving the European Union.  This caused a large drop in the markets the very next day.  

    During the month, I purchased shares in a life insurance company.  I purchased 100 shares of Manulife Financial at $18.61 per share for a total cost of 1865.95 including commissions.  The ticker symbol on the Toronto Stock Exchange is MFC.  The basic description of the company is as follows:

Manulife Financial Corporation (MFC) is a life insurance company. The Company is a holding company of The Manufacturers Life Insurance Company (MLI), a Canadian life insurance company, and John Hancock Reassurance Company Ltd. (JHRECO), a Bermuda reinsurance company. The Company's segments, including Asia Division, Canadian Division, U.S. Division, and the Corporate and Other segment. The product and service offerings of each segment include Protection (Asia, Canadian and U.S. Divisions), Wealth Management (Asia, Canadian and U.S. Divisions), and Corporate and Other segment. It is a financial services company with principal operations in Asia, Canada and the United States. The Company offers financial protection and wealth management products and services to personal and business clients, as well as asset management services to institutional customers. The Company operates as Manulife in Canada and Asia and primarily as John Hancock in the United States.(source:  Google Finance)

       Currently, the annual dividend for MFC is $0.74 per share.  Since I own $0.74 per share, this adds $74.00 to my annual dividend income.  The price of the stock fell sharply as a result of the referendum in which Britian will exit the European Union.  The stock has shown recovery after the sharp drop in the share price.

       I recently wrote about an option in TD Bank, which you can read about here.  I meant to click on sell to do a naked put, or short put, to collect the option premium.  I apparently clicked buy at $0.31 per contract.  How did I discover this error.  When you short, there is a negative sign in front on the amount of contracts or shares.  I notice in my brokerage account it was positive sign.  So I sold $0.47 per contract to close the trade off.

       I then decided to sell a put option in TD, after closing the trade as decribed above.  I collected a premium of $37.05 after commissions.  The option had a expiration date of Jun 30, 2016 as this was a weekly option.  The strike price is $56.00.   At expiration, the option was assigned.  My broker charges an option assignment fee of $24.95.   The adjusted cost basis is $5587.90.  The annual dividend rate of TD shares on the Toronto Stock Exchange is $2.20 per share.  This purchase adds $220.00 to my annual dividend income.

     The HNY position,  inside my TFSA, has been sold.  This is a commission free ETF, which you can read about here.  I sold on the 27 units on June 28, 2016 at $16.29 per unit.  I purchased the units at $14.33.  The distribution of this ETF is paid monthly and it varies month to month.
  
   As of 1 July 2016, the value of the portfolio is  $87684.06 . This is a 0.886% decrease over last month's total.  The spreadsheet in the investment tab above has been updated.

EDIT (July 2): 
I have turned my DRIPs off for all stocks except ERF and two positions directly with the transfer agent which are BNS and ENB.  These latter two positions are shown in the investment tab spreadsheet above and they have fractional shares.  ENB paid its dividend on June 1.  So I acquired 0.159 shares at $51.698 per share. 

Disclosure: Long  all mentioned securities.

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