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Friday, August 5, 2011

My non-registered margin portfolio had gone through a TSX 435.90 points lost without any problems... go baby go

When I left home earlier today to go to work, the TSX had already lost more than 300 points. Little did I know, but it didn’t stop there. On August 4, 2011, the TSX lost not 300, not 400, but 435.90 points. While facing the devastation, I did not feel anything, just like if I was totally disconnected in front of what was happening. I did not feel sad, I did not cry. I just look at the numbers, trying to understand the unthinkable. But this is real. Remember earlier today when I transferred 5 000$ from my credit line to my margin account? Well, the money had remained there.

This is how my non-registered portfolio closed August 4, 2011 session:

Non-registered portfolio value: 105 958$
Money used on margin: 35 481.52$
Money left available on the margin account: 23 471.56$

Even if the TSX lost more than 400 points today, I made it without a margin call or without having to deal with asset being sold automatically by TD Waterhouse to compensate on my margin lost. My non-registered portfolio might look crazy while looking at it quickly BUT I strongly believe that my diversification is what saves me today. I would have been able to go through August 4, 2011 stock market condition even without the 5 000$ that I brought in from my credit line to my margin account. Very good, but what if the TSX continues to lose points? I still have resources. I won’t let the Toronto Stock Exchange beat me. I will beat the beast.

The 2008 stock crash was much more easier to handle. Why? Well, it’s because once the stock market crash, it had reached the bottom line very quickly and following what, the TSX slowly gains points. This time, we are not facing the same thing.

The TSX had lost points on a regular basis for quite a long time now. Yesterday, the TSX rebound a little. And today, we had the crash that we now know. This time, no one can really say if he had reached the bottom or not. And the TSX could lose more points. And if it does, I will have to consider my options. Some analysts said that we could face a down market for the next 6 months or so. Does it mean that the TSX will lose points on every single trading day? We’ll have to live it to find out.

I still remain on my HOLDING position for many reasons. Many investments I hold inside my portfolio are still strong despite facing some major lost today: Bank of Nova Scotia (BNS), Methanex Corporation (MX), Fortis (FTS), Pembina Pipeline Corporation (PPL), Just Energy Group Inc. (JE), Pengrowth Energy Corporation (PGF), Enbridge Income Fund Holdings Inc. (ENF), Corby Distilleries Limited (CDL.A), Davis + Henderson Corporation (DH), EnCana Corporation (ECA), iShares S&P/TSX Capped REIT Index (XRE), Horizons Gold Yield Fund (HGY.UN), Canfor Pulp Products Inc (CFX), Exchange Income Corporation (EIF), TMX Group Inc. (X), K-Bro Linen Inc. (KBL) and First Majestic Silver Corp (FR), to name a few.

I am an eternal market optimistic no matter what and I still want to continue to invest. But this time, exclusively in blue ships, quality stocks. Right now, stocks like TransCanada Corporation (TRP), Canadian National Railway Company (CNR), and Enbridge Inc. (ENB) among other, stuff I talk to buy a little while ago. You know, all those quality stocks that pay very little in dividend? Well, it’s time to BUY a bit of each of them, even if it will be just by lot of 25 stocks. Basically, I plan to do the same thing I did following the 2008 stock crash: invest in stocks whenever I can, whenever money is available. And of course, I hope the market will eventually recover and that my worth will increase not to say explode in value, just like it did following the 2008 event.

I still believe in the market and it’s not anytime soon that I will give up.

I went through an interesting reading coming from the Globe and Mail: What investors need to do as the markets plunge. I really appreciate what John Stephenson, senior vice-president and portfolio manager at First Asset Investment Management Inc. has to say about the actual market situation. According to John Stephenson, dividend investment is still the way to go. Investors don’t have to go exclusively in GICs because of the rough market we are in. Gold and silver are a top value. John Stephenson had named TransCanada and Enbridge as strong value, etc. etc. I just hope he’ll turn wrong when he said that the market could go down to the 9 000 points... I mean, come on, we are in Canada, some of our companies, like PGF for example, are performing very well. COME ON CANADA. I am not giving up on you, don’t give up on me.

I think retailer investors have a role to play, even if it’s a small one. We need to HOLD in order to create HEALTH.

Tomorrow will be a decisive day as data regarding jobs will be available before the market opening. This time, I promise, I will try to wake up on time. ;0)

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