My stock portfolio mainly consists mostly of dividend paying stocks and REITs. This is where I make most of my money. Most of the dividend paying stock I have you will find on such lists as S&P/TSX Canadian Dividend Aristocrats index (see http://www2.standardandpoors.com/ and then look for this index under indices) plus I have some pipelines and an odd assortment of stocks I found interesting. I have been through some bear markets and what has happen is that the value of my stock portfolio has gone down, but my dividend paying stocks have continued to pay dividends. In fact, in bear markets, my dividend income has always gone up; even though the value of my stocks has gone down.
I believe that you must also have fun investing, and that is why I have an assortment of stocks I found interesting.
I bought some 400 shares of Bombardier (TSX-BBD.B) in 1987. Since then it has split 4 times and now I have 6400 shares. It had a huge run up in 2000 and has taken it on the chin until very recently. I must admit I did not think it would crash the way it did. It had always been an excellent stock in the past, just rising and splitting and rising and splitting. I guess I am lucky it is now improving, but even at the current price I have made an average annual rate of return of some 16% on this stock. (I did better with Nortel as I knew it had a checkered past and sold half of my stock at $85, thinking it was too high. I had bought Nortel stock, plus got some via BCE.)
I bought some Research In Motion (TSX-RIM) at end of 1999 and in the first part of 2000. I like tech stocks. I have managed this better than Bombardier. I paid some $12,800 for this stock. I have since sold off about $30,000 (when it has split) and the stock I have left is worth some $60,000. According to Quicken, I have made an average annual return of some 29% on this stock. I would probably have done better on Bombardier if I had sold some when it was high. Well, you live and you learn.
I have bought some nice dividend paying stock when I have sold RIM stock. I will sell some more when it splits again, or gets too high. I will use any money to again buy some nice dividend paying stock.
Saturday, May 31, 2008
Thursday, May 29, 2008
Canadian Bank Stocks
This blog is meant for educational purposes only, and not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional.
The banks are currently a good or bad buy depending on the reason for buying them. If you are buying them for dividend income, to me they are a good buy. The yields on banks are currently high. For example, the yield on Bank of Montreal is almost 6%. The yield on the Royal Bank is almost 4% as is the yield for the Bank of Nova Scotia. The TD bank is not as good. Personally, I avoid the CIBC bank so I have no spreadsheet on it.The CIBC is the only bank that anyone questioned if the dividend was safe. In the other banks, what is most likely to happen is that the increases will slow down. These are good yields considering that normally the bank yields are less than 3%.
The Bank of Montreal has increased the dividend at an average annual rate of almost 13% over the last 10 years and almost 18% over the last 5 years. The Royal bank has increased the dividend at an average annual rate of almost 17% over the last 10 years and 19% over the last 5 years. The comparable increases for the TD Bank are 14% and 13.5% and for the Bank of Nova Scotia, almost 17% and 19%. I do not follow the CIBC bank as I feel it is the worse run bank in Canada.
I would not buy a bank at the present time for capital gains, because I do not know when this current financial crisis will be over with. If I did not have so much in bank stocks already, I would a bank for the dividend income over the long term.
What does these dividend increases mean to you? I have the Bank of Montreal. In 1987, my dividend income from this stock was $156 quarterly. Five years ago in 2003, my quarterly dividend was $411.84. My last quarterly dividend in February 2008 was $873.60.
The energy section of the stock market, especially oil is making lots of money at present. But some day the price of oil will fall, or they will replace oil with something else. Changes like this happen very quickly. We talk about change for years and we wait and wait, then, all of a sudden it happens. Everything changes.
I would rather buy a bank than an oil company. Our banks will make money because of the high price of oil. When the price of oil goes down and it will, the banks may falter a bit, but then they will start to make money out of the next big thing. However, any investment in oil will be gone forever. If I buy any resource company, I also have a sell date in mind. I do not think I will have to sell my banks; although, I could be wrong. What I do know is that I would probably have to sell any resource company long before any bank.
So, in the short term, I feel I can make more money from oil and I do have something like 1% resources in my portfolio, just to keep track of resources. But I buy and hold bank stocks for the long term and I do not worry.
The banks are currently a good or bad buy depending on the reason for buying them. If you are buying them for dividend income, to me they are a good buy. The yields on banks are currently high. For example, the yield on Bank of Montreal is almost 6%. The yield on the Royal Bank is almost 4% as is the yield for the Bank of Nova Scotia. The TD bank is not as good. Personally, I avoid the CIBC bank so I have no spreadsheet on it.The CIBC is the only bank that anyone questioned if the dividend was safe. In the other banks, what is most likely to happen is that the increases will slow down. These are good yields considering that normally the bank yields are less than 3%.
The Bank of Montreal has increased the dividend at an average annual rate of almost 13% over the last 10 years and almost 18% over the last 5 years. The Royal bank has increased the dividend at an average annual rate of almost 17% over the last 10 years and 19% over the last 5 years. The comparable increases for the TD Bank are 14% and 13.5% and for the Bank of Nova Scotia, almost 17% and 19%. I do not follow the CIBC bank as I feel it is the worse run bank in Canada.
I would not buy a bank at the present time for capital gains, because I do not know when this current financial crisis will be over with. If I did not have so much in bank stocks already, I would a bank for the dividend income over the long term.
What does these dividend increases mean to you? I have the Bank of Montreal. In 1987, my dividend income from this stock was $156 quarterly. Five years ago in 2003, my quarterly dividend was $411.84. My last quarterly dividend in February 2008 was $873.60.
The energy section of the stock market, especially oil is making lots of money at present. But some day the price of oil will fall, or they will replace oil with something else. Changes like this happen very quickly. We talk about change for years and we wait and wait, then, all of a sudden it happens. Everything changes.
I would rather buy a bank than an oil company. Our banks will make money because of the high price of oil. When the price of oil goes down and it will, the banks may falter a bit, but then they will start to make money out of the next big thing. However, any investment in oil will be gone forever. If I buy any resource company, I also have a sell date in mind. I do not think I will have to sell my banks; although, I could be wrong. What I do know is that I would probably have to sell any resource company long before any bank.
So, in the short term, I feel I can make more money from oil and I do have something like 1% resources in my portfolio, just to keep track of resources. But I buy and hold bank stocks for the long term and I do not worry.
Wednesday, May 28, 2008
Why have a budget?
The only reason to have a budget is so that you make a conscience decision on how you want to spend your money. Without a budget, you might spend money in ways you do not intend.
In order to start a budget, you need to know how you are currently spending your money. Get a program such as Money or Quicken and enter all your spending. Do this often. You do not want to wait until you have many entries; you want to do a bit at a time, so that it never becomes a big job. These programs will let you print off reports on what you are spending your money on. You can then make a budget based on these reports. This will help you ensure you are spending your money on what you want to spend it on.
I put practically all my spending on my credit card. I also know exactly how much I can spend each month on credit and I keep an eye on my spending through Quicken. Credit card use can be handy and you can get rewards. The one I use all the time is the PC Master Card. I get 1% of my spending back as points that I can use to buy groceries. In the last 12 months, I got $300 worth of groceries free. However, I would never want to spend more than I can repay in a month as the interest rate is almost 25% per year.
When using credit cards, never think that you are not spending money. When I talk to others on credit card spending, this seems to be the main reason they spend too much on credit. It does not feel like you are spending money. This is the wrong attitude, and it can get you into trouble.
In order to start a budget, you need to know how you are currently spending your money. Get a program such as Money or Quicken and enter all your spending. Do this often. You do not want to wait until you have many entries; you want to do a bit at a time, so that it never becomes a big job. These programs will let you print off reports on what you are spending your money on. You can then make a budget based on these reports. This will help you ensure you are spending your money on what you want to spend it on.
I put practically all my spending on my credit card. I also know exactly how much I can spend each month on credit and I keep an eye on my spending through Quicken. Credit card use can be handy and you can get rewards. The one I use all the time is the PC Master Card. I get 1% of my spending back as points that I can use to buy groceries. In the last 12 months, I got $300 worth of groceries free. However, I would never want to spend more than I can repay in a month as the interest rate is almost 25% per year.
When using credit cards, never think that you are not spending money. When I talk to others on credit card spending, this seems to be the main reason they spend too much on credit. It does not feel like you are spending money. This is the wrong attitude, and it can get you into trouble.
Tuesday, May 27, 2008
Manulife Financial Corp
This blog is meant for educational purposes only, and not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional.
I bought this stock (TSX code MFC) in 2005 for my Canadian Trading Account. According to Quicken, I have made a return of some 13% annually (IRR - Internal Rate of Return). Over the last 5 years dividends have added approximately 4% points to its annual return.
I would consider this stock a dividend paying growth stock. It is also growing it dividend, and over the last 5 years the dividend has grown at a rate of some 22%. Of course, there are lots of growth stocks that have done much better, but this stock has very solid numbers. Revenues and earnings are increasing nicely. Book value is not increasing as fast, but is coming along nicely.
The price of this stock has come down recently, but this is more to do with the current financial crunch that anything that Manulife did.
As I have said above, this is a very solid stock. It is in the life insurance business, and these companies tend to be solid and conservative. I worked in the life insurance industry all my life, in the systems area. I was a business analyst. However, analyzing is analyzing, I do well at this, whether it is business systems, stocks or genealogy. I also worked for Manulife in Toronto for 3 years ending in 1999.
The spreadsheet I have placed below will show mostly the past. What you now need to do is compare Manulife with the S&P/TSX composite index. It has not been following the index of late as the TSX has gone up and this stock has not. This is mainly because RIM and resources have taken off. Now compare this stock to the S&P/TSX capped financial index. It has done better than this index over the last year, but has followed the ups and downs of the financial index. You can use the charts at http://www.globeinvestor.com/ to do this comparison. On the Globe & Mail investor site’s search box use “MFC-T”. Also at the globe investor website you can see what some analyst think about the stock in terms of it being a buy, sell or hold. If you have a trading account with a major bank, you can probably get a stock report on this stock from them.
Do not be afraid to buy out of favour stocks or sectors. The idea is to make money and you do this by “buy low, sell high”.
See my spreadsheet at http://http://www.spbrunner.com/stocks/mfc.htm. See my website at http://www.spbrunner.com/stocks.html.
If you email me with questions on this blog, start the subject line off with the word “blog” or “blogspot” so that your email does not end up in my junk mail folder. To get to my email address click, on “Profile”.
This is a life insurance company in the financial services business. It offers financial protection products (e.g. Life Insurance) and wealth management services (i.e. segregated funds, mutual funds and pension products). They sell products to individuals and business. They are an international company, selling in Canada, US and Asia. This company is listed on Canadian, US, Hong Kong and Philippines Stock Exchanges.
I bought this stock (TSX code MFC) in 2005 for my Canadian Trading Account. According to Quicken, I have made a return of some 13% annually (IRR - Internal Rate of Return). Over the last 5 years dividends have added approximately 4% points to its annual return.
I would consider this stock a dividend paying growth stock. It is also growing it dividend, and over the last 5 years the dividend has grown at a rate of some 22%. Of course, there are lots of growth stocks that have done much better, but this stock has very solid numbers. Revenues and earnings are increasing nicely. Book value is not increasing as fast, but is coming along nicely.
The price of this stock has come down recently, but this is more to do with the current financial crunch that anything that Manulife did.
As I have said above, this is a very solid stock. It is in the life insurance business, and these companies tend to be solid and conservative. I worked in the life insurance industry all my life, in the systems area. I was a business analyst. However, analyzing is analyzing, I do well at this, whether it is business systems, stocks or genealogy. I also worked for Manulife in Toronto for 3 years ending in 1999.
The spreadsheet I have placed below will show mostly the past. What you now need to do is compare Manulife with the S&P/TSX composite index. It has not been following the index of late as the TSX has gone up and this stock has not. This is mainly because RIM and resources have taken off. Now compare this stock to the S&P/TSX capped financial index. It has done better than this index over the last year, but has followed the ups and downs of the financial index. You can use the charts at http://www.globeinvestor.com/ to do this comparison. On the Globe & Mail investor site’s search box use “MFC-T”. Also at the globe investor website you can see what some analyst think about the stock in terms of it being a buy, sell or hold. If you have a trading account with a major bank, you can probably get a stock report on this stock from them.
Do not be afraid to buy out of favour stocks or sectors. The idea is to make money and you do this by “buy low, sell high”.
See my spreadsheet at http://http://www.spbrunner.com/stocks/mfc.htm. See my website at http://www.spbrunner.com/stocks.html.
If you email me with questions on this blog, start the subject line off with the word “blog” or “blogspot” so that your email does not end up in my junk mail folder. To get to my email address click, on “Profile”.
This is a life insurance company in the financial services business. It offers financial protection products (e.g. Life Insurance) and wealth management services (i.e. segregated funds, mutual funds and pension products). They sell products to individuals and business. They are an international company, selling in Canada, US and Asia. This company is listed on Canadian, US, Hong Kong and Philippines Stock Exchanges.
Monday, May 26, 2008
My Disclaimer is True
This is my disclaimer. This blog is meant for educational purposes only, and not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional.
Especially relevant is “Before making any investment decision, you should always do your own research”. Read what others say. Does it make sense to you? You should never, ever, invest in a stock because someone else thinks it is a good idea. You should never, ever, invest in anything that you do not understand. This is how people get into trouble. Our current financial problems point to this.
You will find many places on the internet where there are buy, sell, or hold calls given on stocks. The problem I find with this is they never say why they are making the calls they are. Sometime, they include estimates for earnings and revenue. This helps a bit. I do my trading with TD Waterhouse, and as a result of having an account with them, I can view their stock reports. I understand that most banks in Canada have such things available for their customers with trading accounts.
Remember that no one cares about your money as much as you do.
And now that I have figured out how to show my spreadsheets via this blog, I can put up others besides the one I have done for SNC Lavalin.
Especially relevant is “Before making any investment decision, you should always do your own research”. Read what others say. Does it make sense to you? You should never, ever, invest in a stock because someone else thinks it is a good idea. You should never, ever, invest in anything that you do not understand. This is how people get into trouble. Our current financial problems point to this.
You will find many places on the internet where there are buy, sell, or hold calls given on stocks. The problem I find with this is they never say why they are making the calls they are. Sometime, they include estimates for earnings and revenue. This helps a bit. I do my trading with TD Waterhouse, and as a result of having an account with them, I can view their stock reports. I understand that most banks in Canada have such things available for their customers with trading accounts.
Remember that no one cares about your money as much as you do.
And now that I have figured out how to show my spreadsheets via this blog, I can put up others besides the one I have done for SNC Lavalin.
Saturday, May 24, 2008
SNC Lavalin, One of My Favorites
This blog is meant for educational purposes only, and not to provide investment advice. Before making any investment decision, you should always do your own research or consult an investment professional.
I bought this stock (TSX code SNC) in December 1998. According to Quicken, I have made a return of some 35% annually (IRR - Internal Rate of Return). This has been a great stock. Not only has it been great in the growth of its price, it has been great in its growth of dividends. However, after having said this about the dividends, less than 4% IRR can be attributed to the dividend.
I would consider this stock a dividend paying growth stock. It is also growing it dividend, and over the last 5 years it has grown its dividend at a rate of some 25%.
The Graham price was at 31 December 2007 $11.76 and the closing price of the stock was $48.14. This is a huge difference. The Graham Price is basically what the stock would be worth if it was a value stock, not a growth stock. The Graham Price is by Benjamin Graham who wrote the famous book, The Intelligent Investor. The problem is that the Book Value per share is increasing at a much lower level than the stocks price. BV has increased at 9% per year over last 5 years and the stock price has increased at almost 35% per year over last 5 years. You can also see the over valuation of this stock in the P/E ratio at year end of 48.1. This is, of course, a negative for this stock.
The next thing to discuss is what is happening currently on this stock. This stock hit a peak in mid May and has come down. Currently, I would not buy any more because the stock I have is worth approximately 5% of my portfolio. I do not like any one stock getting greater than 5% of my portfolio. However, I will continue to hold it.
See my spreadsheet at http://www.spbrunner.com/stocks/snc.htm. See my website at http://www.spbrunner.com/stocks.html.
I know that this stock has recently been touted as a buy, but there are a number of indicators that says it is overpriced. The problem is that the market is just pushing this stock ever higher and it is generally not advisable to bet against the market.
This company is involved with engineering and construction work around the world, this includes infrastructure and buildings; infrastructure and construction; power (nuclear, thermal, hydro etc); chemicals and petroleum; environmental projects; and mining and metallurgy projects. They have offices and Canada and around the world, from Algeria to Vietnam, including Australia, Europe, Russia, Africa, Middle East, Asia, South America, USA
I bought this stock (TSX code SNC) in December 1998. According to Quicken, I have made a return of some 35% annually (IRR - Internal Rate of Return). This has been a great stock. Not only has it been great in the growth of its price, it has been great in its growth of dividends. However, after having said this about the dividends, less than 4% IRR can be attributed to the dividend.
I would consider this stock a dividend paying growth stock. It is also growing it dividend, and over the last 5 years it has grown its dividend at a rate of some 25%.
The Graham price was at 31 December 2007 $11.76 and the closing price of the stock was $48.14. This is a huge difference. The Graham Price is basically what the stock would be worth if it was a value stock, not a growth stock. The Graham Price is by Benjamin Graham who wrote the famous book, The Intelligent Investor. The problem is that the Book Value per share is increasing at a much lower level than the stocks price. BV has increased at 9% per year over last 5 years and the stock price has increased at almost 35% per year over last 5 years. You can also see the over valuation of this stock in the P/E ratio at year end of 48.1. This is, of course, a negative for this stock.
The next thing to discuss is what is happening currently on this stock. This stock hit a peak in mid May and has come down. Currently, I would not buy any more because the stock I have is worth approximately 5% of my portfolio. I do not like any one stock getting greater than 5% of my portfolio. However, I will continue to hold it.
See my spreadsheet at http://www.spbrunner.com/stocks/snc.htm. See my website at http://www.spbrunner.com/stocks.html.
I know that this stock has recently been touted as a buy, but there are a number of indicators that says it is overpriced. The problem is that the market is just pushing this stock ever higher and it is generally not advisable to bet against the market.
This company is involved with engineering and construction work around the world, this includes infrastructure and buildings; infrastructure and construction; power (nuclear, thermal, hydro etc); chemicals and petroleum; environmental projects; and mining and metallurgy projects. They have offices and Canada and around the world, from Algeria to Vietnam, including Australia, Europe, Russia, Africa, Middle East, Asia, South America, USA
Thursday, May 22, 2008
Social Investing
A friend asked me to look into socially responsible investing and I found the Jantzi Research site. It rates companies re a social investment analysis. Their site is http://www.jantziresearch.com/. Some people feel that looking at a company's financial statements will just give you a view of the past, but not what will happen in the future. Whereby looking at how well companies do re such indexes show you how well they will do in the future. If they get these intangibles right, they will do well in business for the future.
There is an ETF on the TSX using the symbol XEN. This fund consists of 60 Canadian companies that pass a set of broadly based environmental, social, and governance rating criteria. For details on ishare funds like XEN, go to http://www.ishares.ca/splash.do.
The good things about ETF’s is that you can buy the fund on the open market and you do not need to wait until the following day to find out what price you are paying for a fund. The other thing is low MER’s, with the fees under these funds running at about ½ of 1%. There are, of course, pros and cons to everything.
There is an ETF on the TSX using the symbol XEN. This fund consists of 60 Canadian companies that pass a set of broadly based environmental, social, and governance rating criteria. For details on ishare funds like XEN, go to http://www.ishares.ca/splash.do.
The good things about ETF’s is that you can buy the fund on the open market and you do not need to wait until the following day to find out what price you are paying for a fund. The other thing is low MER’s, with the fees under these funds running at about ½ of 1%. There are, of course, pros and cons to everything.
Wednesday, May 21, 2008
How I Started Out
I would buy Canadian Government Bonds, which you could pay for monthly. Bonds can be bought starting in October each year and I would make monthly payments. When they matured a year later, I would cash the bond in and buy some stock.
There are more options available today. You can use high interest savings accounts for regular savings to get enough money to buy stock. You can go to Canadian Shareowners at http://www.shareowner.com/ to buy stocks on a monthly savings plan. You can take out a line of credit to buy shares, paying back the loan over a period of time. My line of credit demands that I pay 3% of my balance each month, after the interest for the month has been added to my balance.
Another method is to buy index mutual funds or ETF’s (Exchange Traded Funds). The index funds simply mirror an index and the MER’s are low. The ETF’s are basically mutual funds traded on a stock exchange, like the TSX. They often mirror some index and their MER’s are also low.
There are more options available today. You can use high interest savings accounts for regular savings to get enough money to buy stock. You can go to Canadian Shareowners at http://www.shareowner.com/ to buy stocks on a monthly savings plan. You can take out a line of credit to buy shares, paying back the loan over a period of time. My line of credit demands that I pay 3% of my balance each month, after the interest for the month has been added to my balance.
Another method is to buy index mutual funds or ETF’s (Exchange Traded Funds). The index funds simply mirror an index and the MER’s are low. The ETF’s are basically mutual funds traded on a stock exchange, like the TSX. They often mirror some index and their MER’s are also low.
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