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. 

     My last trade, I experienced a lost.  That is my second loss out of 15 trades.  I had set a stop limit order to sell 750 shares of BTO @ $2.45 a share.  Why a stop limit order and not a regular stop loss order? According to my broker, Canadian Exchanges do not allow stop loss orders in for form of market orders.  So at $2.45 the stop if executed, so you stop limit order becomes a limit order.  Since it was $2.45, that is the lowest price I am willing to sell the 750 shares.  The stock fell to $2.43 and then had to rise back up to have the stop limit order filled $2.45 or higher.

     The price of the stock could of kept falling more and the order would not have been filled.  This is a downside to the Canadian Markets. 

Note:  The trades are listed under the Trading Tab above with all the trades listed as of May 29, 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.

Covered Call : Potash Corporation

       I recently wrote about a purchase in my margin account involving Potash Corporation of Saskatchewan. Potash Corporation of Saskatchewan is involved in the mining and agricultural space.  Everyone on the planet needs to eat to survive, so fertilizer is needed to help grow the food.  The minerals from the potash mines are used in the making of the fertilizers.

      To increase my returns besides the dividends,  I wrote a covered call on May 17 with a June 17, 2016 with a $22.00 strike price.  The premium I received was $45.05 after commissions.

Summary:

Scenario #1 - Option expires worthless

# of days to expiration = 31
Premium Received =  $45.05 including commissions

Return =  $45.05/$(2200)
            = 2.05%

So I made make a 2.05% return in 31 days.

Return Annualized = 2.05% *(365/31)
                               = 24.11%

For writing a covered call, we get a return of 2.05% in less than a month whereas my high interest savings account  pays 0.80% interest yearly.  

Scenario #2 - Option is assigned 

Adjusted cost basis = $2179.95 including commissions
Premium received = $45.05 including commissions
Option Assignment Fee = $ 24.95
Strike Price = $22.00

Profit = $2200+$45.05-$24.95-$2179.95
          = $40.15

Return = $40.15 /(2179.95)
            = 1.84%

Without option, the return will be smaller as the capital gain (i.e. profit ) is smaller

Return =( $2200-$4.95-$2179.95)/ $2179.95
                                         = 0.693%


     If the price of POT stays below $22.00 at or before expiration, I get to keep my premium of $45.05 and keep my 100 shares.  If the option is assigned, my return is greater due to me keeping the premium.

Disclosure : Long POT

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 Expiration Day - May 20, 2016

    For the most part, options expire on the 3rd Friday of the month.  For the month of May, this 3rd Friday of the month occurred on May 20.  I recently wrote about some option trades that I made which involved covered calls and a naked put.
  
    Two of these options were set to expire on May 20, involving TD Bank and Telus Corporation.  TD  Bank closed higher than $56.00, which is the strike price.  Therefore, my shares of TD Bank were called away.  What is my plan going forward.  I am looking to purchase this stock at a lower price then my previous adjusted cost basis of around $55.30 per share.  I might sell a put option to collect income while I wait for the price to go down.

 

Covered Call on TD at $56 Strike Price

      I previously sold a put option for Telus Corporation with a $40 strike price.  I sold the put option when the price was below $40, which resulted in a higher premium.  The option was not assigned prior to expiration.  On May 20, the price of the stock remained above $40.00 so the option expired worthless.  I get to keep the premium as I was the option seller. 

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 :                 14 
                               Total Capital added:    $250.00
                               Trading Acct Balance:  $ 1920.43
                               Average Drawdown:   $25.27
                               Average Loss:             $25.01
                               Average Accuracy:     92.86%
                               Average Risk:              $32.35
                               Average Reward:         $69.28
                               Average R/R :             1: 2.141

     
       I have been trading penny stocks, stocks and options.  Any dividends that will be received from this account with stay within the account.  As of right now, we received a dividend from Potash Corporation of Saskatchewan of $19.19. 

Note:  The trades are listed under the Trading Tab above with all the trades listed as of May 21, 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.

Recent Buy

       Everyone one the planet needs to eat to survive.  Can we possible profit from this fact?  Yes, we can indeed profit from this.  Healthy food is the food that is grown and not processed food.  In order to grow healthy food, you need to have good soil to grow the food.

       On May 2, I made a purchase in Potash Corporation of Saskatchewan on the Toronto Stock Exchange.

       PotashCorp is the world’s largest fertilizer company by capacity, producing potash (K), nitrogen (N) and phosphate (P). These primary crop nutrients are vital to maintaining healthy and productive soils.

     Our Canadian potash operations – the primary focus and namesake of our company – represent one-fifth of global capacity. To enhance our global footprint, we also have investments in four potash-related businesses in South America, the Middle East and Asia.
     With operations and business interests in seven countries, PotashCorp is an international enterprise and a key player in helping to feed the world. - Source: http://www.potashcorp.com/about/overview/

     Potash Corporation of Saskatchewan produces  potash, phosphate and nitrogen products which help to provide the main nutrients that crops are in need of.  The potash and phosphate are from mineral deposits whereas the nitrogen comes from the air we breath.  Potash Corporation of Saskatchewan sells its fertilizer all of the globe. 

 Summary:

     I purchased 100 shares on May 2, for a total price of 2179.95 including commissions in my margin account. The dividends are paid out in US dollars by the company.  The dividends are then converted to Canadian dollars and placed in the brokerage account.  The stock trades on both the TSX and the NYSE.  So, for shares purchased on the NYSE, the conversion to Canadian dollars does not happen by the brokerage.

      With the world's population increasing, there will continue to be a need to have great fertilizer to help grow the more food. So there is going to be a need for their products for the foreseeable future.

      I will update my investing tab spreadsheet in early June to reflect this purchase. 

Disclosure:  Long POT

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 - April 2016

      The month of April 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 marched higher this month to roughly $44US a barrel  for WTI Crude Oil.  This is good news to go on, but not enough to kick start the drilling activity in Western Canada.  The price per barrel has to go up more and stay up around $50 to $60 dollars a barrel.

      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

• Bank of Nova Scotia (BNS) - $ 22.68
• Bank of Nova Scotia (BNS) - $14.40
• Bell Canada Enterprises (BCE) - $68.25
• Enerplus (ERF)  -$ 5.58
• Shaw Communications (SJR.B)    - $19.75
• Restaurant Brands International (QSR) - $17.99
• Rogers Communications Inc Class B (RCI.B) - $96.00

TFSA

• Boston Pizza  Royalties Fund (BPF.UN)   - $26.91
• Claymore 1-5 yr Laddered Corporate Bond ETF (CBO)  - $0.69
• Cominar REIT (CUF.UN ) - $5.39
• Dream Office REIT   (D.UN)  - $ 17.50
• Transforce (TFI)  - $8.50
• Killam Properties REIT (KMP.UN) - $  15.10

Total = $318.74

        This total represents a 20.46% decrease  from 3 months ago and 7.132 % increase year over year. The decrease from 3 months ago is in part due TD paying its dividend  near the end of the month and a distribution for the end of the year being paid in January.  The TD dividend will show up in May and there was no distribution from XDV has my units were called away by an option assignment.

      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 $1846.47 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.

Please Note:  One BNS entry is for transfer agent account and the other is from the margin account.

How was your dividend income for April?

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 - Apr 2016

   The month of April 2016 is now behind us.  During the month, we say the price of WTI Crude Oil rise to approximately $45US a barrel.  Although, we are not out of the woods yet, this is positive momentum for sure. 

    I wrote a covered call for TD with a $56.00 strike price that expired on April 15, 2016.  I get to keep the premium though as I am the option seller.  I also previously sold a put in QSR with a $48 dollar strike price that expired on April 15, 2016.  The value of QSR stock had good upward movement has earnings were coming up. 

    I previously sold 3 option call contracts in XDV, the iShares Canadian Dividend Select ETF.  This option was assigned on April 15.

     With the options expiring worthless above, I decided to write more covered calls.  On April 19, I wrote a covered call in TD.TO with a strike price of $56.00.  The expiration date is May 20 and I collected a premium of $59.05 after commissions.  On April 19, I also wrote a covered call in RY.To with a strike price of $80.00.  The expiration date is June 17 and I collected a premium of $59.05 after commissions.

      With the option assignment of XDV done, my units of the ETF were called away.  I then decided to sell a put in Telus Corporation (T.TO) with a $40 strike price and May 20 expiration day.  I collected a premium of $84.05 after commissions. You can read more option these trades by clicking here.

 Shares Acquired Though Drip

        I turned off all drips inside my brokerage accounts previously.  The DRIPs are still on for the ENB and BNS held with the transfer agents.  BNS paid a dividend this past week, but the amount of new shares and at what price takes a while to show up.  As of right now, this information is not available.

     As of  May 1,  the value of my portfolio stands at $86115.10. This is an increase of  3.067% over last month. I will update my investing account tab above.

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