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Saturday, August 6, 2011

My austerity plan: bread, peanut butter and black coffee

I just received my Just Energy dividend. I almost reached the 700$ in dividend income for the month of July, which is good, despite the fact that my portfolio seem to have reach the bottom line.

I transferred back a 5 000$ on my credit line. This leaves me like this for August 5, 2011 session (before the 5k deduction):

Non-registered portfolio value: 104 434$
Money used on margin: 35 481.52$
Money left on margin: 22 675.66$

I am under the 20k mark on my margin account (after the 5k deduction) and it seemed like my worst fear is slowly taking form: the TSX is losing points trading day after trading day. The US recently lost their triple A credit rank. Next Monday session will probably be very ugly, but I prefer not to think about it for now. Before Monday session start, I will again apply applied 5 000$ on my margin. But that time, it could not be enough.

I am seriously thinking about transferring my TFSA asset into my non-registered account. I am kind of froze in the moment and I find it very hard to go through this. It’s something very difficult to live. However, I always did what I wanted all the way, I don’t have any regrets – at least for now.


Anonymous said...

Better watch out on Monday. With S&P downgrading US debt, this might create a massive selloff on Monday... and beyond... possibly another recession since borrowing cost will go higher and slow down job creation, spending, slow down in economy, negative GDP etc...

high on Dividends said...

That is the problem with margins. What is your plan if the market drops another 1000 points? you will be selling everything? or what is plan B?

Dividend stocks = good
margin = Very bad

roman said...

Dont kid yourself you just giving them money and the Jew on wall street are laughing.

Sunny said...

Hi Anonymous, I am totally aware of what could happen Monday. But will the massive sell off that already happen, I believe we may face lost again on Monday - but a moderate one. That's what I am hoping for.

Hi High on Dividends,

From my calculation, I may be able to go through a 1 000 points - but that's while having a 5 000$ apply on my margin coming from the credit line...

I have other resources to face an deep correction, like transferring my TFSA into my non-registered account, selling my US investment and transferred it into my Canadian non-registered. But for now, I am waiting to see what will be happening.

I will be investing 1 000$ later on this week.

I won't ever sell my portfolio.

I went through it so far, just check me going. Margin is bad if you are afraid of the stock market and panic while facing a crash.

I am pretty sure I will be able to go through this. If not, TD Waterhouse could eventually sell part of my portfolio. I still have 105k worth on the market and I have 35k borrowed on margin (following the 5k deposit from credit line).

105k - 35k = 70k

The worst think that could happen is that TD Waterhouse liquidate for 35k of my portfolio. If it happen, this will still left me with a 70k worth on the market. The game won't be over.

Hi Roman,

I wrote that part because I read something about the Wall St brokers advice to buy stocks instead of selling, I think this last Friday. I plan to buy from time to time, not only to please Wall St but also to please me as an investor. There's good opportunities at this time and I plan to invest once every month, but this time, in blue chip only.

Rob said...

Hi Sunny:

First of all, I'll answer the question you asked of me which was "Do I expect the stock market to lose 60%?" The answer is "No I don't" It should lose 60% but I totally expect Berknucklehead (Fed Reserve Chairman Bernanke) to unleash QE3 anytime. QE is basically money printing to prop up a way overvalued stock market. The downgrade may set off the chain of events I have been long expecting. Forcing interest rates higher which will kill the banks and all the rest of the dividend junk. One rule you need to learn. I saw that you were invested in HZD - This is a leveraged silver Bear ETF. Silver and gold are in a bull market. Never ever invest against the primary trend. Any drop in gold and silver is just market noise. It is an opportunity to go long on these metals. I totally expect to make thousands tomorrow when the stock market tanks and gold and silver rocket higher. I will be very disappointed if that doesn't happen. The gold and silver stocks continue to offer the best value as they have diverged too much from the record prices of the underlying commodities. I will repeat one thing I have said on your blog before. Gold and the Dow will revert to a 1-1 ratio. Currently gold is 1,700 /oz and the Dow is 11,444 as I write this. I wish you luck as always but your portfolio needs a major overhaul to have any chance of making money. I saw another comment regarding we might be going into another recession. Huh? We never left the depression that started in 2008. The correction in stocks was the increase back to the current levels. Stocks are in a bear market for the foreseeable future and should be avoided.

Sunny said...

Rob, you are charming as always. I taught that you had left the place for good, gees that I was wrong. I made money from the market before, I will made money from the market. I had investment in FR, PHS.U., American Sprott Silver and ho, check me cashing in 50$ per stock once the Maple Group project will be approve.

There's good things going on, some of my investments are up, other had loss in value, other are quite stable.

So that my portfolio don't generate money? Well, it may not grow in value, but the dividend will be great, at least. And I always been in for the long term.

HZD was part of a day trading experience. I got stuck with it by accident. I am looking to sell whenever I have a chance.

Gold and silver are top values of the time. You keep repeating what everyone else say about gold. Like coming here and pointing out the fact that my portfolio needs a major overhaul to have any chance of making money - well you know what, its just like everyone else portfolio. People who had invested in stocks are all to the same point. The value is not there, but it will come back later.

Anonymous said...

Sunny, this is off topic but "taught" is the past tense of "teach".


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