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Tuesday, June 27, 2017

My dividend income is now close to the $700 per month

I visited another apartment this evening, but it was way too small and no balcony... I am trying to find a new apartment at a cheaper price than of what I am paying now, but its not actually working for now. And I don't want of an apartment that will cost me more than what I am paying now. Its all very complicated and Montreal if full of dirty rat holes.

In exactly 2 months from now, I will be turning 37. I am not exactly a young woman anymore, but I don't feel old. I don't think I look my age, or at least I wish so. Anyhow, I never saw a year going on so fast. Life goes on, and the stock market is not exactly cooperating. The TSX closed without real direction today. Nothing is going on like it should. Its all pretty mess up. 

My latest investment in Home Capital Group Inc. (HCG) took a bad trip today. Anyhow, I discovered that HCG actually pay a dividend. And I also notice just today that I totally forgot to add WSP dividend in my spreadsheet income. And I also forgot to add in the latest NFI dividend increased. All that together make a new annual dividend income of $8 305.28, or the equivalent of $692.11 per month. My $700 goal is just so close! It was a fantasy of mine to hit on the $700 dividend income. And its now about to happen - or should I say soon. 

From there, it will be easier for me to repay my big fat margin account. So watch out.


Anonymous said...

Home Capital suspends dividend as the balance on its high-interest accounts sinks by half in one week.

"Fools are easily separated from their money"

Anonymous said...

I don't know a lot about the company, and an concerned about what other ghosts may be lurking in their closet. Also, where most homes had multiple offers in Toronto back in March, many are getting no offers today. I think Home Capital is now a speculative trading stock.

Good luck - hope it works out for you!!!

frederic said...

I don't think there is much risk in Home Capital Group going lower. It's beaten down, and will get back on its feet eventually. But I don't think there is much upside.

The problem is that Warren Buffer is getting millions of new shares of the company and the result is dilution of the existing shares. In other words, the investor's shares are going to be worth less. The earning per share will be less. Etc.

It's better than the stock going to zero, but still not good for the investors. The first part of the deal went approved without a vote because of a special condition with the TSX, but there is a second part that deal that gives millions more share to Buffett, that will be up to vote later, as far as I can tell today. (Shareholder meeting was on the 30th of June)

The price of the stock probably went up briefly due to short covering.

Buffett doesn't get any decisional or strategical influence on the company, he's a lender and in return for a good interest rate, he gets millions of shares at a discount.

Buffet gets these new shares at 9.55$. He does not lose any money unless the shares go below that. The stock is at 17$, so he's in the money!

Buffett is not really investing in capital group. The actual deal is that he's lending money to them, and will make more money later selling his shares at a profit.

Anonymous said...

HCG does not pay a dividend any more. They had to suspend it. Also Buffet is not investing 2 billion. He is lending 2 billion at 9%.

Unknown said...

Hi Dividend Girl,

I chanced upon your blog when Marc Cohodes tweeted your post on EIF.
I have read through some of your recent posts and very interested in your approach to income investing, financial freedom and related topics.

I am an income-growth investor myself, and use a bottom-up approach to security selection.

I have been comparing and contrasting your approach with my own.

Anyhow, I have a couple of questions for you based specifically on this blog entry from June 2017.

The effective distribution yield on your portfolio is about 2.85% (annual income / portfolio net present value).
I am curious why you have not opted for an ETF based approach, instead of picking dozens of individual stocks & income trusts.
For instance, the TSX iShares ETF XIC has an effective distribution yield of 3%.
It contains almost all the securities that you own individually, as well as many more.
Your monthly income will be about the same, however, you won't need to analyze, transact and monitor dozens of stocks.

Secondly, I would also like to know why you have chosen to hold small positions in dozens of stocks instead of larger positions in a smaller subset of securities.
I assume you perform some form of analysis and valuation on the stocks that you purchase.
Isn't it a significant amount of effort to analyze, value, and monitor so many individual stocks, rather than a smaller subset?

Lastly, have you considered preferred shares to boost your yield?
In addition to other benefits, preferred shares will save you from not having to hold so many high yield stocks and income trusts.

I am building my own income growth portfolio and keen to share ideas and approaches.

If you like, we can discuss through Twitter, email, or your blog.



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