Dividend Increase

       Enbridge is known for raising its dividend shortly after the Dec 1 dividend payment. This year Enbridge decided to not raise the divided until January.  This was due to the vote on the acquisition of Spectra Energy in the United States. The investors of these 2 companies voted in favor the acquisition.

Enbridge Inc. operates as an energy transportation and distribution company in the United States and Canada. Its Liquids Pipelines segment operates common carrier and contract crude oil, natural gas liquids (NGL), and refined products pipelines and terminals. The company'’s Gas Distribution segment operates as a natural gas utility that serves residential, commercial, and industrial customers in Central and Eastern Ontario, and Northern New York State, as well as in Quebec and New Brunswick. Its Gas Pipelines, Processing and Energy Services segment has interests in natural gas pipelines, including the Vector Pipeline and transmission and gathering pipelines in the Gulf of Mexico, as well as holds an interest in Aux Sable, a natural gas fractionation and extraction facility. This segment is also involved in the renewable energy projects, such as wind, solar, and geothermal projects with a generating capacity of approximately 2,800 MW. The company’s Sponsored Investments segment is involved in renewable and alternative power generation; crude oil and liquid petroleum transportation and storage; and natural gas and NGL gathering, treating, processing, and transportation. Enbridge Inc. has a strategic partnership with EDF Group for the development, construction, and operation of three French offshore wind farms. The company was formerly known as IPL Energy Inc. and changed its name to Enbridge Inc. in October 1998. Enbridge Inc. was founded in 1949 and is headquartered in Calgary, Canada. (Source: Yahoo Finance)

       Late in the afternoon on January 5th, Enbridge announced a 10% dividend increase.  The quarterly dividend payment has been raised from $0.53 per share to $0.583 per share.  This represents an annual dividend rate of $2.332 per share.

      I currently own 48.983 shares of Enbridge across 2 accounts. My annual dividend income will increase $10.38.  I did not have to do anything except be a shareholder of this company. This $10.38 increase is equivalent to investing $296.57 of my own money at a 3.5% yield.

      Enbridge is planning to raise the dividend again upon the completion of Spectra Energy that would represent a total dividend increase of 15% over the dividend rate of 2016. 

Disclosure : Long ENB

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.

First Option Trade of 2017

      I currently own 200 shares of Potash Corporation of Saskatchewan (ticker symbol POT), which were bought on the Toronto Stock Exchange.  POT also trades on the NYSE.  My covered call on POT expired worthless on Dec 30.  So on Jan 3, I sold 2 covered call contracts in POT with a $25.00 strike price and expiration day of January 20.  I collected a net premium of $40.05 after commissions.

      POT is currently in the process of merging its company and Agrium into one of the largest potash supplies in the world.  The shareholders of each company recently voted in favor of the merger.  There is a lot of hurdles still overcome in order for this deal to go through.

Summary:

Strike Price : $25.00
# of contracts : 2
Option Assignment Fee:  $24.95
Premium received after commissions: $40.05
# of days until expiration : 17
Adjust Cost Base: $4245.85

Scenario # 1:  Option Not Assigned

Return = $40.05 /( $5000)
            = 0.801%

This return of 0.801% is for 17 days.  Currently, interest rate on my high interest savings accounts is 0.80% year. 

Annualized Return = ($40.05 / $5200 )* (365/17)
                                =  17.20%

Scenario #2 : Option is Assigned

Total Return = (Profit - Adjusted Cost Basis) / Adjusted Cost Basis
                      = ($5000+$40.05 - $24.95 - $4245.85 ) / $4245.85
                      = 18.12%

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 - December 2016

      The month of December 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 markets continue to go higher in the month of December.  The price of barrel of crude oil continues to trade over $50.00 per barrel and is currently around $53.00 per barrel.  The Toronto Stock Exchange has lots of energy companies, so energy is a major part of investing decisions for Canadian investors.

      One thing for sure, is that I was paid dividends and distributions for being a shareholder or unit holder in  various companies or funds. In  Sept 2016, the Dream Office REIT in the margin account will be counted as dividend income  for the first time.

 Non-registered Account

• Enbridge (ENB) - $8.39
• Enerplus (ERF)  -$ 5.58
• Dream Office REIT   (D.UN)  - $ 75.50
• High Liner Foods (HLF) - $7.00
• Shaw Communications (SJR.B)    - $19.75
• Westjet Airlines (WJA) - $19.60

TFSA

• Boston Pizza  Royalties Fund (BPF.UN)   - $26.91
• Canadian National Railway (CNR) - $14.25
• Cominar REIT (CUF.UN ) - $41.16
• Dream Office REIT   (D.UN)  - $ 17.63
• Enbridge (ENB) - $17.49 
• Horizons Natural Gas Yield ETF (HNY)  - $4.43
• Killam Properties REIT (KMP.UN) - $  15.10

Total = $272.79

        The bond ETF , Claymore 1-5 yr Laddered Corporate Bond ETF, did not pay a distribution in December.  It usually pays at the end of the month. As December 31 is the end of the year, they will pay the distribution within the first 10 days of January. This bond ETF will also pay a distribution at the end of January. 

        As the amount of distribution from D.UN inside my margin account, will have a large impact on the comparison of dividend income from 3 months or from 12 months ago.  Therefore, I will not compare November 2016 dividend income with that of 3 months and 12 months ago.

 Dream REIT has reduced the amount of distribution they pay monthly which was announced in February 2016.  Recently, I wrote about purchasing more units of D.UN inside a margin account.  Starting in September, the distribution from this D.UN inside the margin account will be included in my dividend income.

             I currently have DRIP turned on for the following stocks in margin account, which are D.UN and ERF.  DRIP is turned on for D.UN and CUF.UN inside my TFSA.  DRIP is turned on for BNS and ENB with the transfer agents. When investing with transfer agents directly, all the dividend is reinvested as you are able to buy partial shares. When you can only purchase whole shares with DRIP, then the dividend received has to be higher than the price of the stock to receive at least one share.

     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.

     This month I received a personal record in options premium collected.  I received $655.10 in option premiums for the month of December.

EDIT(Jan 10) :  Cominar REIT paid out 2 distributions which were paid on December 15 and December 30.  For the December 30, the record date was December 16 which would means the ex-dividend date was 3 business days before  December 16. Therefore the new acquired 1 unit from DRIP on December 15 does not count in my total. The distribution on December 30 is the same as December 15, which is $20.58 for 169 units. The table above and dividend income tab have been updated.

How was your dividend income for December 2016?

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.