Stock Portfolio

Behind every great dividend growth investor is their Stock Portfolio; the list of stocks which they’ve had the conviction to purchase in hopes of bringing them riches – to a DGI, riches can be nothing more than a stable monthly income that rises over time, which will eventually cover their annual expenses, resulting in financial freedom. I invite you to have a look into The Dividend Beginner’s portfolio.

My investment portfolio spans across my tax-free savings account (TFSA), and a $USD and $CAD taxable, non-registered account all contained within my brokerage of CIBC Investor’s Edge. Currently, with CIBC Investor’s Edge, a minimum value of $25, 000 is required for an RRSP without fees. I am not interested in that, and the RRSP is something I will focus more on once the $CAD returns back to near-par with the $USD, as I would like to fill it with high-yielding $US stocks and REITs due to the tax-treaty for withholding US taxes.

My stock portfolio accounts for roughly 65% of my net worth, while the the other 35% of my net worth is tied up in savings accounts, TFSA GICs and RRSP GICs, which I had locked in before I started investing. The TFSA has a maturity date of 3 years, while the RRSP has a maturity date of 5 years. For the time being, I’m not concerned with them too much; while they return very poor results, they keep my cash safe and keep me from investing all of the money I have.

I started investing on the date of March 18th, 2015.
Below is my current portfolio.

  • Nice mix of stocks in your portfolio, DB. I understand you are just starting your journey, but you should think about diversifying and investing in US-based companies. There are some sectors which you simply cannot get good exposure to, when you stay only in the Canadian market. The best way for that is to go the US route – which have more global players.

    Best wishes
    R2R

    • Hey R2R,

      Actually I would love nothing more than to branch out into US-based companies. I can see their long-term dividend growth stocks are much more fruitful and there are so many to pick from. Canadian market is primarily composed of financials and energy, while there is so much more to love in the US going full throttle.

      The only thing really stopping me at this point is the fact that a CAD is only 0.80 cents on a USD, which really brings me down. I look at it as I have to earn 20% more on my investment (which may really be the wrong way to look at it) to get the same value for my dollar.

      Best regards,
      Dividend Beginner

      • Just found your site. Its pretty inspiring, and I am thinking about shifting some of my investments to more dividend based stuff. Most of mine are trying to get gains in stocks rather than more consistent dividends.

        You definitely shouldn’t think about it that way though. Assuming a constant exchange rate, a % gain on your investment is the same % no matter what currency it is in. Making 7% on 100CAD is the same as making 7% on 80USD. And 7%, as you said, is conservative gains.

        Where you would possibly ‘lose’ money is when the Canadian dollar strengthens against the US dollar. You also should not worry about the fluctuations in exchange rate, since it doesn’t actually matter until you convert the currency back. You can always delay converting the currency back until it is more favorable.

      • Correct me if I’m wrong but I have the same problem like you where AUD is around $68 at the moment of writing (I’m in Australia) but I realized that once your capital starts making money in the US your capital will be making more than your local currency which evens it up as long as it doesn’t go the other way around.

  • Not a bad looking portfolio though a little heavy on the REITs for my taste and for your number of individual holdings. Still, you seem to be getting a pretty nice yield from this portfolio. Look forward to further additions.

    • Hey DH,

      I agree I may have gone slightly overboard. When I started investing a couple months ago I saw the beautiful yields they pay out and thought it’d be a good jump on the income play. While I study other companies and make more informed, diverse choices going forward I’ll have this yield backing me up as I do so.

      Thanks for commenting,
      DB

  • DB,
    Seems like you prefer REITs at this stage, thats a good boost to propel your dividend income a nice head start. I am not very familiar with CAD stocks right now, I only own two: BNS and TD.

    Keep up the great job, seems to me you have a solid foundation. Keep us updated!

    Take care!

    • Hey FFF,

      Yeah I’m a big fan of REITs but I need to force myself to start diversifying further. I’m hoping to make an insurance purchase soon to guard and prosper against rising rates. Both BNS and TD are solid buys! Hoping BNS releases good earnings later today as have the other major Canadian Banks.

      Thanks for visiting FFF!

      Best regards,
      DB

  • I was going to post this on your Quora comment on (http://www.quora.com/Is-it-better-to-invest-in-rental-properties-or-dividend-stocks), but figure I’d put it here instead as it will be pretty long and ranty.

    Very nice that you have started early at 21 and are currently investing (or will be) $1,500/month. You may want to provide information about your lifestyle expenses and current income to show readers how you can achieve your goals. Though understandably not everybody wants to put up this information as it can reveal quite a bit about yourself. Perhaps a link in the header specifically for “About Me” with details.

    You are coming on at an interesting time where we’ve reached all time highs on many things in the markets, so be careful. You’ve got time to learn and experience the roller coaster ride of investing and changing environments… and time in your life that if we hit a big bump – you are ready to protect yourself/ride it out 🙂

    I noticed you opened a non-registered account. At 21 you are coming in with enough TFSA contribution room to reach $18,000/year (*Confirm with the Canadian Revenue Agency if your available contribution room only starts @ age 18, or from when TFSA started in 2009 – http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/tfsa-celi/cntrbtn-eng.html#tfscntbtnrm). Based on assumption the TFSA room starts in 2012 when you were 18; then at least for this year, and the next, you have enough contribution room available to NOT bother with using fully taxable non-registered accounts.

    Check this out: 2012 @ $5,000 + 2013 @ $5,500 + 2014 @ $5,500 + 2015 @ $10,000. Total for 2012-2015: $26,000.

    Your yearly planned investment contribution is $18,000. Leaving $8,000 available for next year.

    Next year, 2016 @ $10,000. Plus leftover $8,000 from 2015 = $18,000.

    Your available room in 2012-2015, plus next year 2016 gives a final total: $36,000. Sweet deal.

    Some suggestions with your portfolio.

    I agree with other comments above regarding your dependence upon REITs for higher yield. Keep in mind if you end up putting REITs into non-registered accounts, the income generally are NOT dividends and are taxed at a higher rate. It is generally more straightforward, since you just started out in March 2015, to keep REITs in the TFSA.

    Consider maximizing your fire power and concentrate further on existing positions. It is VERY tempting to want to own different stocks, but at this moment you end up diluting yourself and having too many things to track. CIBC’s $6.95 commission is a very decent compared to most other brokerages, but going after many different companies eats into what you can purchase overall. This ties into my next suggestion.

    To immediately, automatically, and incrementally start increasing your income consider participating in Dividend Re-investment Plans (DRIPs). As the name suggests the dividend is reinvested back into more shares, but at no cost to you. To do this contact your broker and tell them to set all your stocks/REITs into (Synthetic) DRIPs. Only if the dividend/distribution is sufficient a full share is purchased, otherwise you will get cash.

    DRIP example (without discount):
    TPH: 450 shares*$0.025/month=$11.25 distribution
    $11.25/$2.61 current share price = 4.310344827586207 shares. Rounded down to a full unit = 4 shares, with the rest paid to you in cash. No commission. Granted you don’t have control over the share purchase price, but really $11.25 would be sitting in your account doing nothing.

    Building on top of DRIPs, is the DRIP discount. This could mean you DRIP shares at a lower price. I’m not sure if CIBC participates in this, but at least two of your holdings: Temple REIT and H&R REIT; have DRIP discounts of 4% and 3% respectively. (See http://www.templehotels.ca/drip.asp and http://hr-reit.com/Investor-Relations/Monthly-Distributions/DRIP-and-Unit-Purchase-Plan.aspx)

    When tracking your investments – you might want to have a column for your effective yield. It is pretty nice to see your yield based on your adjusted cost basis.

    Again, good for you starting relatively early in your life. Best of luck.

    Disclaimer that you should confirm/check what I’ve written 🙂

    • Hi J!

      Wow.. Thank you so much for this comment. Honestly it was helpful for me to read and I really appreciate that you took the time to provide me with such value.

      First of all, I have wanted to inform everyone on the blog of my lifestyle/income/expenses, but I am not yet ready.. I am still deciding whether I want to take it that personal or not, but it was definitely crossed my mind and would help keep track of many things.

      About the TFSA contribution room, I actually have a TFSA GIC holding $5,000 and my Investor’s Edge TFSA is at $10, 000 contribution. I had opened a taxable account to have it ready for some extra money coming in, though was informed later that a fee would be charged if i did not have $10k in there before September rolled around, so I am just planning to fill that up then will put the rest in my TFSA non-taxable.

      Wow, I did not know that REIT dividends are considered straight taxable income in taxable accounts. I had decided to keep them all in my TFSA thankfully. It makes more sense to keep all those high-yielding securities non-taxed for obvious reasons, but that knowledge is very powerful and helpful.

      About concentrating on some core portfolio companies rather than branching out too much, I am starting to think the exact same thing. I have been building outwards, but now plan to go through more rigorous analysis and decision-making before purchasing new companies, and would like to purchase mores shares in T and BNS actually.

      Concerning DRIPs, I have read on them and have made the tough decision to not participate in them, because I think I could make better use of the cash dividends and use them (once amassed) to purchase shares in companies of my own choosing trading at good valuations. That’s just my personal decision, though I may DRIP further down the road in some really solid companies. It is a great method as I’ve read in The Lazy investor by Derek Foster, and a few other places.

      I have also been thinking of tracking original yields on cost for comparison in the years to come, will definitely blow my mind a couple years down the road!

      Thank you so much for commenting J, I really appreciate the time you took to write this answer. I sincerely hope to see you around the blog as I progress.

      Best regards,
      DB

    • I’m new here, but I just wanted to throw in my 2 cents re: the DRIP and adding to positions vs diversification.

      I pretty much only get in on something if I have enough sitting around to ensure I will get at the minimum 1 share each month (on a monthly payer) or 3 shares each quarter (for the quarterlies). I have it set up in my online account that these are handled automatically and I record the increases in my spreadsheet accordingly.

      I also agree with J that, as time passes, the effective yield is a lovely column to have. My effective yield from dividends only for BCE was 8,1% in 2015. Good times.

    • Hey Ralph,

      I’ve looked briefly into Questrade, but decided to stay with my current broker as the fee is only $2.00 more per transaction, and I trust the big bank to hold my money more at this stage. I also have all my banking and insurance with CIBC, so it’s nice to have it all in one organized place.

      Thanks for the recommendation,
      DB

  • Dividend Beginner,
    I just discovered your blog! You are new to the game like myself. Its great to see other young bloggers getting started so early in the game. Your portfolio is shaping up nicely. The only recommendation I have is to look at the list of dividend paying companies that have been increasing dividends for over 25-30 years. I put the link below.
    Keep in touch.
    LOMD
    http://www.dividend.com/dividend-stocks/25-year-dividend-increasing-stocks.php

    • Hi LOD,

      Indeed I too enjoy meeting the newbie investors so the other income posts don’t intimidate me too much haha.

      Considering I live in Canada, we really don’t have too many dividend aristocrats, only a few which have increased dividends for over 20 years. I try to look for 10+ years in Canadian companies.

      Thanks for stopping by
      DB

    • Hey mati,

      I invested in Goldcorp when they had a small record of increasing their dividends. Unfortunately, the company was unprofitable and cut their dividend and the share price plummeted. I’m holding them for some gold exposure, waiting to see what happens. I would not invest in the company now if I had the choice.

      Thanks for commenting,
      DB

  • Nice portfolio to start off. If I was to start all over again, I would probably try out the couch potato strategy until I reach the 50K$ or 100K$ milestone.

    Check it out here : http://canadiancouchpotato.com

    3 Index Funds (ETF’s) would do the trick.

    Afterwards I would probably start buying individual stocks on market dips. I would still keep my ETF’s.

    Having said that, investing its own money means you do it yourself and the way you want it! 😉

  • Looks like you’re missing a plugin or something, your portfolio isn’t showing for me here. Thank you for putting all of this out there.

    PS: I also have some PGF.TO left and am wondering what do with it 😉

  • Hey
    Your portfolio table doesnt show up, just has a link in there. By the way, your blog is quite informative and I enjoy reading your material.

  • Hey there, just wondering why only choose stocks with dividends around the 4% rang. Does the risk dramatically jump up after that point for you? I’m 22 and trying to do pretty much the same thing as you, except I am hoping to expedite the process by only picking stocks with around 8% to 13% dividends. Anything past that point for me seems like entering a danger zone from what I’ve found.

    I justify higher dividends because of my age. I assume I’ll make some mistakes but later on Ill relocate the money to lower dividends stocks when my risk tolerance goes down. I think since we’re 22 we can take a little more risk. What do you think?

  • Hello,

    I came across your website and I am very interested to see your portfolio but the link does not work.

    I am 28 (in BC) and also a dividend type investor as I see these stocks as “money paid into your pocket after the business has taken what it has needed to grow” is good for me. I am still count on that business to grow and hopefully appreciate in value but it also gives me some wiggle room to subsidize daily expenses or invest in our dividend stocks. I am also try to achieve financial independence but realize that I may be starting a little late.

    I would appreciate the heads-up when you are posted your portfolio.

    Thanks!

  • Hi,

    Great website and some very good ideas. However, I am not able to see your portfolio. Is it something I am not doing or something you need to fix on your side?

    Thanks,
    Mahxe

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My publishings on dividendbeginner.com references an opinion and is for information or entertainment purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice. I am not responsible for any decisions you make concerning finances, taxes, or investments. You must perform your own research and always take caution when extending capital.