The
month of August is now behind us. What an ending to the month! The ongoing talks between the United States, Canada, and Mexico continued through out the month in regards to NAFTA, or North American Free Trade Agreement. Canada was sort of left out towards the end as the United States and Mexico came to an agreement. This agreement was announced in the past week and the United States gave Canada until Friday August 31 to come to an agreement. There was no agreement reached involving Canada.
This was not the only major news in Canada. A panel of 3 judges denied the expansion of the Trans Mountain pipeline between Alberta and British Columbia that would of meant Alberta getting their oil resources to foreign markets beside the United States. The panel of 3 judges stated the Canadian government failed to consult properly with indigenous people with respect to their land and rights and, " that the National Energy Board's review of the proposal was so flawed that the federal government could not rely on it as a basis for its decision to approve the expansion.". The day of the expansion being denied was the same day as the Kinder Morgan shareholder's voted approximately 99% in favor of selling the exist pipeline and other related assets to the federal government of Canada.
The Canadian federal government says it is determined to getting the pipeline built and will continue with the acquisition of the current Trans Mountain pipeline and its related assets. Canada's finance minister, Bill Morneau, said that the sale of Trans Mountain pipeline and related infrastructure will be finalized in a few days.
After hearing the denial of the expansion of the Trans Mountain Pipeline, the premier of Alberta said Alberta is withdrawing from the federal government Climate plan immediately. Currently, the Alberta has a carbon tax of $30 per tonne which was expected to increase in 2021 to $40 per tonne and $50 per tonne in 2022. Alberta has said it will keep the carbon tax at $30 per tonne unless the Trans Mountain expansion of the pipeline can move forward.
Portfolio Activity
With the recent interest rate hikes in the past several months, the interest rate on my margin was 7.2%. That is quite high, so I decided to take action. I sold the 631 shares of Dream Office REIT (D.UN) inside my margin account, which you can read about
here. I started to accumulate shares of D.UN inside my margin account in 2013. The distribution payout has been cut a few times. This sale decreases my annual dividend income by $631.00.
For disclosure, I still own 168 shares of D.UN inside my TFSA.
We often hear that we are suppose to eat fish at least once a week for health benefits. For most people, their lives are so busy they do not want to make a special trip to the grocery store to buy fresh fish. Instead, they can look to the frozen fish market for the fish eating needs. High Liner Foods is a company that sells frozen fish products under its High Liner brand and other brands. Also, High Liner Foods is the supplier of fish burgers for McDonald's filet-o-fish sandwiches.
I
purchased 90 additional shares of High Liner Foods (HLF.TO) to bring my total share account to 290. High Liner Foods currently pays a $0.58 per share annual divided, therefore this purchase increases my annual dividend by
$52.20.
I sold 2 put options contracts in WestJet Airlines with an August 17 2018 expiration date. The strike price was $17. I collected
$28.05 premium after commissions. As the seller of the option I get to keep the premium due to the obligation to be PUT, or buy, the shares at the strike price on or before expiration. This option expired as on August 17 2018 as the price of WestJet Airlines stock (WJA.TO) stayed above $17.
On August 23, I sold 2 more put option contracts in WestJet Airlines with a September 21 2018 expiration date. The strike price, as before, is $17. I collected another
$28.05 in premium after commissions.
I collected a total of $56.10 in option premiums on these 2 option trades.
My covered call on Restaurant Brands International (QSR.TO) expired on August 17 2018 as well. The strike price was $88.00.
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Shares Purchased Via DRIP
There was no shares purchased this month via DRIP. My shares directly with the transfer agent are full drip. In August these positions did not pay a dividend. For the other DRIPs, the dividend is not large enough to acquire a full share, therefore the entire dividend is paid out as cash.
Dividend Increases
Emera Inc. (EMA.TO) announced on August 9 2018 that they will be increasing the annual dividend from $2.26 to $2.35 per share commencing with the November dividend payment date. This represents an increase of 3.98%. This is a smaller increase than in previous years as the company lowered its target of increases for the next few years to lower their debt and to have the dividend increases be lower then expected earnings growth. Since I own 100 shares, this increases my annual dividend income $9.00.
Canadian Imperial Bank of Commerce (CM.TO) , better known as CIBC, announced on August 23 2018 that they will be increasing their dividend from $5.32 to $5.44. This represents an increase of 2.26% increase. CIBC has been increasing there dividend after every two quarters for the past several years. Since I own 28 shares, this increases my annual dividend income by $3.36.
Bank of Nova Scotia (BNS.TO) announced on August 28 2018 that they will increase the annual dividend from $3.28 to $3.40 per share. This represents an increase of 3.66%. Bank of Nova Scotia has been increasing their dividend every 2 quarters for the past several years. Since I own 60.971474 shares altogether, this increases my annual dividend income by $7.32.
These dividend raises increase my dividend income by $19.68. This is equivalent of investing $562.29 of my own money at a yield of 3.5%.
As of September 1 2018, the value of the portfolio is $116281.67. This is a 0.936% decrease over last month's total. The spreadsheet investment tab above has been updated.
Disclosure: Long all mentioned stocks
Please Note: All stocks are from the Toronto Stock Exchange except TTR which trades on the Venture Exchange.
EDIT: September 1 2018 - The federal government in Canada now officially owns the Trans Mountain pipeline and infrastructure in Alberta and British Columbia. The expansion of the pipeline is not allowed as of this date. More work by the government will need to be done.
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.
