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Monday, October 14, 2013

Happy 2013 Thanksgiving Investors!

I came back this week from my vacation in New Brunswick. And it was actually hard for me to realize that I was off too for Thanksgiving! I was very excited. Since my return, the weather had been very nice in Montreal. My next get away in New Brunswick will probably be in December and at that time, I will have close to one full week.

Nothing much this weekend, if not a lot of sleeping in and money counting. I went to the Mont Royal yesterday and it was gorgeous. In New Brunswick, winter is about to come but here in Montreal, its still early in autumn season. When I arrived home last Saturday it was very very COLD!

As for the money, my RBC credit line is now completely paid off, my BMO MasterCard as well. Next step is my $10 000 TD credit line at 9% which I am looking to paid off as much possible or the next few months. Currently, my non-registered portfolio is where I like it to be. At $119 845.63, I am extra close to the 120k. I was quite surprise to be able to rack high even while the value of my Exchange Income Corporation (EIF) stock was deteriorating. I had loss a 1k on that stock alone. I don't mind too much as the rest is balance. For me, a balance portfolio is when its at 120k. And I am there right now. But I do monitor the situation with EIF. It seem like the stock is facing a sell-off with no special reason. Investors are cashing their profit. I talk about selling partly EIF in a previously post (guest I felt it coming!), but hey, its ok the way it is. I am the Dividend Girl no matter what.

The JFT Stategies Fund (JFS.UN) is slowly gaining in profit - but the small grow certainly doesn't worth the management few. And I don't earn any dividend on this one. So go figure. Don't ever invest in a mutual fund or hedgies because you find the manager sexy awesome ok? Don't do like this girl. The kind of problem I have with Jean-François Tardif can only be resolve in the comfort of an hotel room anyway.

I had left available over 14k on my margin so I proceed with a transfer of 10k on my TD line and I proceed with another 3k transfer on my second credit line at 5k. Doing such transfers help me to save big interest fee. For September, I paid $39 interest on my 10k at 9%. The statement look crazy with all those transfers (I do 2 transfers daily in and out, to assure my margin can follow the market sexy grove), but it certainly does worth it at the end knowing that my credit lines are at 9% and 8.75% and my margin only 4.25%. And I paid $195 interest fee on my margin. And on the 5k credit line at 8.75%, I paid $27 in interest. It make $261 in interest fees for those 3 credits. But of course, I will save even more once my 2 credit lines will be paid off.

For the past couple months I began to pay off my debt because I want to secure my position. In a year from now, my 10k line will be paid, as well as my 5k credit line, as well as my $2 500 at American Express. So it totally worth it. I will be very happy once I will be able to put an extra 2k on my TD credit lines. Once crazy transfer completed from my margin my theses credit lines, the amount left to be paid would be of... $0. Viva the margin account!!

I don't care about my student loan debt, which is only of something like 5k (tax credit) and I don't care too much about my other credit line debt, which is at less than 5% interest rate anyway. Following what, the next big thing will be to pay off my 54k margin, or at least decrease its usage. I am not a fan of selling investment to pay off debt and I decided not to work at a second job, if not only self-employed and a bit of writing on the Internet. I spent my twenties working at several jobs at the same time and I don't want to do that anymore. Luckily, it didn't destroy my youth. I am happy to be wrinkles free at 33. There's no place for wrinkles on my pretty face. I want the eternal youth of Miss Lise Watier.

I update my dividend income. For a year, without taking in consideration my RRSP, I am at $6 626.67. Not too bad, but I would like to see that number growing. As long I get paid more than 4.25% in dividend income on future investments, well you know, it worth it to invest a few thousands here and there. 

I would like to invest a 1k right now. CT Real Estate Investment Trust recently catch my attention. Its actually very interesting: Canadian Tire is a tenant of this Reit and CT Real Estate is actually being launch by Canadian Tire. Ingenious, isn't? Canadian Tire had been mention as the most significant tenant, but the REIT has other clients too. This IPO doesn't seem to be available at TD Waterhouse, but it could be possible to get in anyway. I haven't check on more.

A second option would be ING High Income Floating Rate Fund. This IPO is available at TD Waterhouse. The units are at $10 each and the minimum number of units to be purchase is 100. At $1 000 only and with no commission fee, this one is quite interesting. The dividend distribution is not fix, but it should be around 6.5% per year. You know the little song: dividend distribution may vary from time to time.

But between those two, I am much more interested in CT Real Estate Investment Trust. I expect the ING High Income Floating Rate Fund to be a bit like my Horizons Gold Yield Fund (HGY.UN) and Sprott Strategic Fixed Income Fund (SFI.UN). What I had experimented so far by holding  such fixed income is that the value of the units barely ever grow, and - worst - it actually decreased while facing catastrophic stock market situation. It could worth more to invest in some TD stocks, get a lower yield for now, but later on, with the capital gain + dividend income, the results could be better. Its difficult to get some good capital gain with fix income.

The CT Real Estate Investment Trust is a lot more interesting because it is directly to Canadian Tire. Its really too bad TD Waterhouse doesn't have it. Just prepare to wait and wait more again over the phone wild calling for this one! When an IPO is not listed with them, TD Waterhouse has one represent per province - only one - to deal with this kind of shit. SO BE PATIENT. I haven't call on this one. One problem will be that you need to call during business hours because the one and the only rep available doesn't seem to be doing any overtime. MISERY. Anyway, I will let know how it went on this one for sure!!!

I will be able to move forward only if the minimum investment required is of 1k. Over that, forget about it, I cannot expose to more leverage, even for Canadian Tire. I have about $250 in cash in my TFSA, so I will only need $750 from deep in my pockets - not too much. That's the plan for now.


Anonymous said...

Why do you care about getting in at the IPO? Most IPOs are bad deals for retail investors. Usually the stock trades down after issue, plus you might save a few bucks in commission but you have to implicitly pay the underwriters fees for the IPO. Just wait until it trades on the open market.

Anonymous said...

Oh God! you are not going to learn from your mistake. Do not buy mutual funds and IPOs. Buy only well estabilished dividend paying high quality stocks. Slow and boring but steady return. You should have gained over 20% return with those blue-chip companies. $120 000 x 20% = $144 000. So you should have $144 000 right now. Sound amazing?

Anonymous said...

I can't figure this Canadian Tire REIT out at all. According to Riocan REIT their #2 anchor tentant is Canadian Tire. This includes their call centre. Now Canadian Tire claims to be putting 200 + of their stores under their REIT. CTC also claims to have 400 retail stores, total. This also leaves out CTC's other holdings, Sportchek and Marks. These do not appear as Riocan tenants. Also it doesn't mention the gas bars. The actual buildings seem pretty cost intensive, as there's ongoing enviornmental assessments, waste disposals, green intiatives etc. Has Riocan got the wheat (best store locations & value for square foot) and CT REIT the chaff (duds), or is CTC hanging onto the 25% remainder for themselves?
Too complex for me. Cheers!

Anonymous said...

Why are you borrowing money at 9% to earn dividends at 4.25%? Do you understand that this is the same as just lighting 5.75% of your money on fire every year?


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