International Diversification Via an Exchange Traded Fund (Part 2)

 I have held Tangerine funds within my RRSP for a few years and then sold out.  I kept the cash with Tangerine as a high interest savings account for about 3 years.  The interest rate kept dropping and I got more and more frustrated.  I decided to make a move.

I transferred my RRSP to my brokerage to make better investments and hopefully better returns.

I decided to start off with international exposure.  I decided to go with XAW ETF based in Canada.  The ETF is actually called iShares Core MSCI All Country World ex Canada Index ETF.  To learn more about this ETF, click here.

I now own 76 units of this ETF.  I did not use my own money, except the capital to purchase other positions to help pay for it.

To see how I purchased the first 35 units of XAW, click here.  

Steps

From Part 1

          -   total raised cash was $1004.13.

          - total purchase cost of 35 XAW units was $934.34

 Now Part 2  (September 2020 to August 28 2021)

           

- September 21  Covered call on Fortis expired 

- September 22  Sold 2 Nov 20 2020 FTS.TO covered calls for net premium of $158.05

- October 27  Bought 2 units of XAW at $$28.25 for a total cost of $56.51 including ECN fees 

-  November 13  Bought to close 2 Nov 20 2020 $54 FTS.TO covered calls for net cost of $201.95

-   November 13   Sold 2 Dec 18 2020 FTS.TO $54 covered calls for net premium of $284.05 . 

- December 1   Collected $101.00 dividend from FTS.TO 

- December 14 Bought 8 units of XAW at $30.30 for a cost of $242.43 including ECN fees.

- December 21   Covered call expires worthless

- January 6   Received XAW distribution of $10.23

- January 25    Sold 2 April 15 2021 FTS.TO  $54 covered calls for net premium of $78.05.

-  January 27  Bought 2 units of XAW at $31.58 for a cost of $63.17 including ECN fees.

- March 1   Collected $101.00 dividend from FTS.TO

- April 16   Covered call is assigned.

- April 28   Purchased 400 shares of Telus Corporation. 

- April 30   Bought 6 units of XAW at $32.77 for cost of $196.64 including ECN fees

- May 10  Sold 4 June 18 2021 T.TO $27 covered calls for net premium of $66.05

- May 10  Bought 3 units of XAW at $32.60 for cost of $97.81 including ECN Fees.

- May 12  Bought 14 units of XAW at $31.60 for a cost of $442.45 including ECN fees

 June 8   Covered calls are assigned. 

June 14  Purchased 400 shares of New Flyer Group  (NFI.TO)

June 14  Sold 4  July 16 2021 NFI.TO $27 covered calls for net premium of $126.05 

June 28   Covered calls on NFI.TO were assigned

June 30    Received XAW distribution of $15.82

July 5   Bought 100 shares of CP Rail

July  6   Sold 1 Sept 17 2021 CP.TO $95 covered call for net premium of $164.05

July 19   Bought 6 units of XAW at $33.75 for cost of $202.52 including ECN fees 

Summary:  

From Part 1    Total cash available = $1004.13

                     Total costs of purchases = $934.34

   Total cash after part 1 is $69.79

Now  for Part 2

Option Premiums Received = $158.05 +$284.05 +$78.05 +$66.05 +$126.05                                                +$164.05

                                       =  $876.30

Dividends / Distributions received =  $101.00+$10.23+$101.00+$15.82

                                                 = $228.05 

The total amount is $1104.35

 

Purchase cost of 41 units of XAW =  $56.51 +$242.43 +$63.17 +$196.64                                                                +97.81+ $442.45+$202.52

                                                 =  $1301.53

Purchase cost of Buy to Close option = $201.95

The total cost  is $ 1503.48. 

 So, we have the following as of Aug 28, 2021:

$69.79 (left over from part 1) + $1104.35 - $1503.48 = - $329. 34 . 

I am short $329.34.  So I will have to collect dividends and sell more option premiums  to get this number to be positive.  Currently, I can received dividends from the CP Rail position and from XAW itself.  I also have a covered call on CP Rail that with an September 17 2021 expiration date.  

  

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 Dividend Increases

As an investor in dividend paying stocks, I look forward to getting paid on regular scheduled  basis.  

You know what is even better?   I like when the company that I own raises their dividend or distribution payout, just like any other investor.  

One of the stocks I mention below have slashed their dividend over the years and it remained at a low amount for a few years.

 

Dividend Increase #1

On August 5,  Killam Properties REIT (Ticker symbol  KMP.UN.TO) announced increased their annual distribution from $0.68 CAD to $0.70 CAD.  This is an increase of 2.94%.  The distribution is paid monthly to investors.

I currently own 302 units of Killam Properties REIT.  Therefore, this increase adds $6.04 to my annual dividend income. 

This distribution increase will start with the September 2021 distribution to paid out in middle of October 2021.  

Dividend Increase #2

On August 5,  Enerplus Corporation increased their quarterly dividend from $0.033 to $0.038, or from $0.132 to $0.152 annually.  The dividend is paid in Canadian dollars.  This is an increase of 15.15%.

I currently own 753 shares of Enerplus Corporation (ERF.TO).  Therefore, this increase adds $15.06 to my annual dividend income. 

The increase will start with the next dividend payment in mid-September 2021.

Enerplus paid a monthly dividend up to May 2021.  This dividend is then switched to quarterly starting with the June payment date.  

This 15.15% dividend increase  follows a 10% increase announced in May 2021.  These two increases came after several years of dividends  cuts followed by about 5 years of the same monthly dividend. 

This is one investment that I regret as I am still down a lot.  Some of the dividend reduction was the result a structure change.  Enerplus Corporation was previously an income trust in Canada.  With an income trust, a business would paid a high dividend to investors to avoid paying taxes.  The taxes would be paid by the individual investors.

After 2011, Enerplus switched to a corporation as the federal government started to take income trusts differently.  Majority of income trusts converted to corporations for the same reason.  This was what the government wanted to happen.   

Dividend Increase #3

On August 11, Intertape Polymer Group increased their quarterly dividend from $0.1575 to $0.17 USD, or $0.63 to $0.68 USD annually.  This is an increase of 7.94%.

I currently own 120 shares of Intertape Polymer Group  (Ticker Symbol  ITP.TO).  This increase adds $6.00 USD to my annual dividend income.  This is equivalent to $7.57 in Canadian dollars at the time of this writing.

Summary:

These increases show that being patient  and owning investments for the long term will result is being rewarded.  As the profits of these companies grow, the companies will reward their investors with increasing dividend and distribution cash payments.

These 3 increases have increased my annual dividend income by $28.67 CAD, at the time of this writing.  This is equivalent of investing $819.14 of my own money at a 3.5% yield.

Disclosure:  Long  ITP.TO, KMP.UN.TO, ERF.TO

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 - August 16 2021

    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 :                       55

                               Total Capital added:          $250.00
                               Trading Acct Balance:       $4432.80
                               Average Drawdown:          $175.00

                               Average Loss:                    $287.20
                               Average Accuracy:            85.45%
                               Average Risk:                    $187.04
                               Average Reward:              $111.30
                               Average Risk/Reward :      1: 0.595

        I have been trading penny stocks, stocks, REITS and options.  Any dividends that will be received from this account will stay within the account. The accuracy rate is high. Does this mean that I am a super trader? No it does not.  The risk to reward ratio states of every $1.00 of risk there is reward of  $0.595.  Ideally, a trader should aim for a 1:2  risk to reward ratio which causes the accuracy rate to be lower.  I lost big on a trade as I did not put a stop in at the initiation of the PZA.TO trade.  The stock kept dropping and dropping, so I felt it was best to sell.   

      The drawdown above is intra-trade drawdown.  This type of draw down is the dollar amount the trade moves against you.  Why is it important to keep track of inter-trade drawdown?  It helps you know if you are picking good entry points.  It is normal for trades to have intra-trade drawdown.  

Below is a chart of my 2021 percentile gains

Click to Enlarge

The above chart shows that the trading account has been down most of the year to date.  

Below is a chart showing my overall percentile gains from January 1, 2016, to August 14, 2021.

Click To Enlarge

Conclusion:

I have not gotten the results that I have wanted over the last couple of years. This is evident in the long roughly flat line in the chart above.  

I need to gain better entry points and to make sure to use a stop loss.  In the trading platform for my brokerage, you can put in a stop limit order when purchasing a stock via a bracket order.  

Note:  The trades are listed under the Trading Tab above with all the trades listed as of April 14, 2021

Note:  As of April 16, 2021, there is no active trades. 

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 Income From Some Canadian Bloggers - July 2021

In July 2021, COVID19 remains front and center in the news.  The number of cases as started to rise again due to the Delta variant form of the virus.  More and more places are starting to relax restriction by a great deal.  

The percentage of people fully vaccinated (2 doses) continue to increase, along with the surge in number of cases.  A lot of people believe being vaccinated total eliminates the possibility of contracting COVID19.  Being vaccinated mainly reduces how ill you will become with COVID19.  In other words, a fully vaccinated individual can be a carrier of the virus and spread the virus to any other individual.

In July, the government of Alberta and the Chief Medical Officer of Health stated that on August 16, all remaining restrictions would be removed and COVID19 would be treated like the flu.  This past week,  the Chief Medical Officer retreated on the upcoming changes and extended the remaining restrictions to September 27.  This is due to the number of cases increasing, which is mainly due to the Delta variant.  People were protesting in Edmonton and Calgary to rollback these changes since they were first announced by the Chief Medical Officer.  

Will the number of cases increasing, we are starting a fourth wave in may jurisdictions across the globe.  This will affect the markets, as investors are concerned about how this will affect the world economy.

CN Rail's purchase of Kansas City Southern still has not been finalized.  There is still a high probability that this deal is blocked by regulators.  Kansas City Southern is still in favor of the deal. 

Let's get to the list of dividend income from some Canadian bloggers for July 2021. Of course, I first want to mention my own dividend income report.

Passive Canadian Income received $1757.92 in total passive income in July.  The amount of dividend income received was $872.00 and dripped 16 new shares.  

Reverse The Crush received $53.48 in dividend income.  This is a 68% YoY increase.  

Our Life Financial received $3429.82 in dividend income and 61 new shares via DRIP.  Also in the post, Our Life Financial mentions her new purchases.      

Moneymaaster received $1408.98 in dividend income and dripped 52 new shares/units to boost his future dividend income. 

My Own Advisor shared his dividend income update with the world.  Although the amount of actual dividend income received in July 2021, this is some great information in the post.  Mark writes about his shares purchased via DRIP, including a big one from Telus Corporation.  

Conclusion:


We all started with $0.00 of passive income and have grown our investments over time. Each "BUY" transaction can provide ongoing dividend income which may also be increased over time.

In Canada and the United States, many brokerage accounts offer commission free trades and/or commission free ETFs. You can get started on your investing journey with very little money.

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 Income Update - July 2021

            

      

The month of July 2021 is another month of dividend income landing in my accounts.  In July 2021, I became debt free as I paid off my line of credit.  

Due to become debt free, I changed my pay myself model.  Starting the beginning of August 2021.  I am paying myself 30%, just like before.  This will now consist of 24% to investing, and 6% to savings.  The investment portion is going to my TFSA. Any money left over at the end of the month, I put towards investing on top of the money allocated from paying myself first.  Hopefully, I can keep this up!

 

Note: All the dividends and totals below are in Canadian Dollars.

Non-registered Accounts 

Bank of Nova Scotia (BNS) - $57.33  (Transfer Agent)

Bank of Nova Scotia (BNS) - $18.00  (Margin Account)

Bell Canada Enterprises (BCE)  -   $87.50  

Canadian Imperial Bank of Commerce "CIBC"  (CM) - $160.60

Restaurant Brands International (QSR)   - $65.13

Rogers Communications Class B  (RCI.B)  - $100.00

Shaw Communications (SJR.B) - $19.75

Subtotal : $508.31


TFSA

A&W Royalties Income Fund  (AW.UN) - $5.13

Algonquin Power and Utilities  (AQN)  - $26.74

Boston Pizza Royalties Income Fund (BPF.UN) - $16.51

Cominar REIT (CUF.UN) -    $6.84

Killam Properties REIT (KMP.UN)    - $17.11

TD Bank  (TD)   - $48.98

Telus Corporation (T)  - $15.18

TFI International  (TFII) - $14.19

Subtotal: $150.68

Total = $658.99

I received a total of $658.99 in dividend income for the month of July 2021.  This represents a 3.13% increase from 3 months ago and 21.7% increase year over year.   

The increase from 3 months ago was mostly due to my recent position of Algonquin Power and Utilities. 

I received dividend / distribution income from  14 different companies.  

I received $78.05 in option premiums within my investment accounts in July 2021.

Below is a visual of my dividend totals for the last 5 years.

Click To Enlarge

Most of my dividend income comes from my margin account. 

Click To Enlarge

Next, I will show the percentage of total income for each position.

Click To Enlarge

I will update my dividend income tab with the new amount. I will include my option premium income also. It is great to see money from passive income sources deposited into my brokerage account every single month.

Note: Any activity in my RRSP account is not included in these totals. 

How was your dividend income for July 2021?

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 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 : July 2021

The month of July 2021 is now behind us. 

The hot weather continues in Western Canada.  Although Western Canada is not in a heat dome still, we are basically in a heat wave.  The difference between the two is that a heat wave will have significantly lower temperatures at night.  The province of British Columbia still have multiple wildfires.  Some of these forest fires are due to climate change. Real dry conditions mean that wooded areas can ignite very easily via a lightning strike, cigarette but thrown out a window etc.   

COVID19 is still the major topic of the news.  In Alberta, Canada, the province recently announced that on August 16, all restrictions will be removed.  On top of that, there will be no contact tracing and test numbers released.  Also, people who test positive for COVID19 will no longer have to self isolate.  In other words, COVID19 will be treated as a flu.  In order to get tested for COVID19, an individual will have to go to a doctor as their will no longer be testing clinics in major cities.  

In terms of the Alberta situation, the federal health minister penned a letter to the Alberta health minister asking to show scientific evidence to show the ending all restrictions is in the best interest of the health of its citizens.  As of August 5, kids under 12 are not eligible for a vaccine as there is no vaccine approved for kids under 12.

Countries around the world are starting to have outbreaks of COVID19, with the Delta variant leading the way in new cases of COVID19.  Countries are starting to strengthening their restrictions to help reduce the spread.

As investors, this will definitely affect the markets due to the fears of COVID19 and the ever increasing amount of major weather related disasters happening all around the world.  

Portfolio Activity

Margin Account Activity

On July 19, I sold 2 MTL.TO Aug 20 2021 $12 put contracts and collected a premium of $78.05 after commissions.  The company behind this ticker is Mullen Group, which is a company that owns various trucking companies in the oilfield services and regular transportation sector.  Mullen Group owns companies mostly in western Canada and recently expanded their presence in Ontario and south of the border.

The premiums received have been treated like income I would received from a job.  So I paid myself first by sending money to my TFSA, savings and rest for spending money.  

  

The amount of days to expiration is 32.  If the option expires, the return would be 3.25% for 32 days, or  37.1% annualized.

TFSA Activity

There has no activity in this account for July 2021.  I continued to build up cash in this position by paying myself first and keeping the dividends in the account.  

Shares Purchased Via DRIP

1 shares of AQN.TO @ $14.9786 USD for a total cost of $18.74 CAD (TFSA)

1 unit  of BPF.UN.TO @ $14.57 for a total cost of $14.57 (TFSA)

0.732334 shares of BNS.TO @ $78.284 for a total cost of $57.33.  (Transfer Agent)

Alqonquin Power and Utilities  pays a dividend of $0.1706 USD per share quarterly, or $0.6824 USD per share annually. This drip adds $0.6824 USD  to my annual dividend income. At the time of this writing, the canadian dollar equivalent is $0.853 per share annually.  The yield on cost (in terms of the CDN) for this DRIP is 4.55%.  

Boston Pizza Royalties Income Fund pays a distribution of $0.065 per unit monthly, or $0.78 per unit annually.  This drip adds $0.78 CAD  to my annual dividend income.  The yield on cost for this DRIP is 5.35%.

Bank of Nova Scotia currently pays a dividend of $0.90 per share quarterly, or $3.60 per share annually.  This drip adds $2.64 to my annual dividend income.  the yield on cost for this DRIP is 4.60%.

I have some other positions with the DRIP turned on, but might not have enough of a dividend to purchase a whole share. 

My Enbridge position directly with the transfer agent is set up to DRIP.  Around November 2018, Enbridge stopped their DRIP program.  If Enbridge decides to start a DRIP, then my shares will start to DRIP again automatically.  

Please note that if some brokerages DRIP shares when there is no DRIP program by the actual company. This DRIP is when the brokerage buys the shares directly off the public market stock exchanges. 

Dividend Increases

On July 28,  A&W Royalties Income Fund increased their distribution from $0.135 per unit monthly, to $0.15 per unit monthly.  This is an increase of 11.11%.  Although this is a substantial increase, the distribution is still below the pre-pandemic level.   

I own 38 units of AW.UN.  This increases adds $6.84 to my annual dividend income.

Dividend Decreases

There was no dividend decreases in July 2021. 

Summary: 

As of August 5, 2021 , the total value of the portfolio is $160019.57. This is a 1.175% increase over last month's total. 

The portfolio is estimated to produce an estimated $5810.93 in dividend income over the next 12 months. This is an increase of $14.23 CAD , or 0.245%. Some of the dividends in the Canadian stocks section are paid in US dollars, which are converted to Canadian dollars. 

Please Note: Positions in Restaurant Brands International (QSR.TO) , Intertape Polymer Group (ITP.TO), Brookfield Renewables Corporation (BEPC.TO), and Algonquin Power and Utilities (AQN.TO)  pay dividends in US dollars. Brookfield Renewables Partners (BEP.UN) pays distributions in US dollars. My investment tab spreadsheet displays the Canadian dollar equivalent within 15 to 20 minutes of real time. 

Disclosure: Long aforementioned stocks

                
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 an