January 2018 Dividend Update

A lot happed in the month of January. As noted in last months update, we decided to rebalance the dividend portfolio and remove shares that no longer fitter the portfolio and the dividend growth strategy.  Here is the January 2018 Dividend Update.

January 2018 Dividend Update

What’s changed in January on the dividend front? The following shares disappeared from the portfolio:

  • POT (Potash) & AGU (Agrium): these merged and are now Nutrien LTD (NTR). The shares of  both companies where exchanged for NTR shares, and plummeted next…… Not really creating any shareholder value at this point. To maintain exposure to this basic materials sector we will keep the shares for now. We are also curious to see how the dividends will develop.
  • WJA (WestJet – Airlines): this was not really a good growth stock (sensitive to the economic cycles) and we were able to sell with a profit, so we did.
  • LIQ (Liquor stores): another non dividend growth stock (heck, it cut dividend a couple years back). One of our “chasing yield” stocks from when we started. Now that the share price had recovered, it was time to sell and reinvest the profits.

We also made some new Purchases:

  • REI.UN (RioCan): not really a “dividend growth stock” but it was battered recently due to the rising interest rates. It made for an interesting buy. It’s a REIT and a monthly dividend payer. With the Canadian REIT’s there are very few dividend growth stocks. However, due to their relatively high yield and monthly DRIP’s, they still are in interesting dividend “growth” investment. Plus, we want to have some real estate exposure and diversification too.
  • We also increased our existing positions with new share purchases of CU, H and FTS (all utilities).

We now do have some cash that we need to deploy and are evaluating this awesome list to see which positions we need to grow or start.

Oh, don’t forget to check out the community updates at the Dividend Diplomats and Easy Dividend!

January Dividends

All the dividend deposits received into the bank accounts (and correct for exchange rates) sum up to a total dividend income of about €522,5. This is a decrease of 4.1% compared to last year. However, this is all caused by a significant exchange rate fluctuation compared to a year ago. In Canadian dollars the dividend actually grew by 4% from a year ago. See, it’s still dividend GROWTH investing 🙂

The stats for last month:

January 2018 Dividend Update - Dividend Income

January 2018 Dividend Update – Dividend Income

The graph below is showing the yearly dividend totals for 2015, 2016, 2017 and the YTD for 2018. We thus received €522,50 in dividends in 2018.

January 2018 Dividend Update - Yearly Dividend

January 2018 Dividend Update – Yearly Dividend

Dividend Stock Overview

Our dividend portfolio now contains 37 companies with a total of 9.044 shares. The ones with a keen eye among you will see NTR noted twice in this overview, this is due to the merger of POT and AGU (we each had one of these in our RRSP accounts). Since I’m lazy (and have the spreadsheets setup to provided an overview of both accounts individually), this probably won’t change albeit we would like to sell on of the two positions.

The portfolio looks like this:

January 2018 Dividend Update - Dividend Overview

January 2018 Dividend Update – Dividend Overview

Dividend Sector Breakdown

When you breakdown the previously shown dividend stock overview by sector, it looks as follows:

 

January 2018 Dividend Update - Sector Allocation

January 2018 Dividend Update – Sector Allocation

 

How did you do in January?

Please follow and like us:

20 comments

  1. Ah, that’s a bummer about the exchange rates. Still, nice dividends though!

    I use to hold a number of Canadian stocks, but now the exchange rates and extra taxes generally make me avoid “international” investments.

    1. Makes sense, it’s the reason we only hold Canadian shares, a means to avoid “double” taxation.
      The exchange rates are a thing on paper only at this time, will see what happens once we have to actually withdraw from the accounts.

  2. Strong month guys! Keep it going. I’m still wondering why people would want dividend stocks instead of broadly diversified index trackers, but looking at your portfolio (and yearly dividend income!) I see why you are drawn to it. For me personally it still doesn’t make sense, both from the diversification point of view as well as from a taxation point of view, but please keep going like this!

    1. I agree with the diversification standpoint, but funnily enough you appear to be able to beat the indexes (looking at the S&P500 here) when just focusing on dividend growth investing. The cash-flow is just an added bonus. On the taxation side of things, with a regular account in the Netherlands, this does not matter much (you can correct your wealth taxes with already paid dividend taxes). So there is little difference between ETF’s and dividend shares, but when you have a tax deferred account abroad (like we do), there can be some nice benefits! Thanks for the visit.

  3. Awesome, awesome month Team CF! That’s what I’m talking about here. Despite the “decrease” you made some excellent portoflio moves and cleaned up some of your holdings. The Cheesy Index is really starting to flex its muscles and produce some nice Cheddar for your dividend stock portfolio.

    Cheers,

    Bert

  4. I’m a long time reader of your blog and respect your achievements!

    Although I have been investing in ETFs for some years now, I also would like to build a dividend portfolio. Any suggestions how to start with limited funds (2.5k and probably 500p/m)? I know that can check i.e. the aristocrats and review P/E ratios and so on, but what for instance would your minimum invested amount per stock be to balance between fees and spread? And in which sequence should I buy my stocks?

    I hope you would like to share your point of view.

    1. Hey Coelho,
      Thanks for the compliment! We personally try to keep transaction fees below 1% where possible (of the total transaction amount). This means we often make buys between €500-1500 per transaction. As to the sequence, begin with the shares you really would like to have and that are on “sale” (Unilever/ABImbev come to mind at this moment as contenders). Considering you already have ETF’s, and thus already have some diversification, you don’t have to focus on diversifying your portfolio just yet. It’s the perfect time to just randomly shop for bargains. At some point, and this is personal, you should start to look at diversifying your dividend portfolio too. We strive to have around 40-50 different shares for our dividend portfolio (target value around €150-200k).

      Good luck!

    1. Because we have not withdrawn any from the accounts, nothing really changed (i.e. no gains/losses). But the CAD/EUR fluctuated over recent years between about 1.25 to 1.58. So there have been quite large fluctuations. Will have to see how we will deal with this during the withdrawal phase.

  5. Great work modifying your portfolio, I can understand the sell of the airline company. You have such a nice portfolio and some of these names will have to be in my portfolio to some day! Anyway, a 4% grow (corrected for exchange rates) is not bad at all!
    My January was quite nice, had €29,93 of dividends vs €0 last year. Can’t wait to look back at my first full year of investing already!
    Take care!

    DI

  6. Great work cheese. Solid income.

    Why you thinking of selling nutrien? I have actually thought of buying more just waiting to find out the dividend to be announced. They are going to be a great company imo

    Anyways nice buys and great month
    Cheers

    1. Due to the merger we have quite the positions in NTR, a bit too big for my taste (it’s about the largest position in the portfolio, close to CU @ €7.000). Will certainly keep the company to see how they will develop and how the dividend is going to be, but like to get the position down to about €5000.

    1. The exchange rate varied quite a bit from around $1.4/€ to almost $1.53/€, not helping the value in euro’s! But the underlying results are pretty decent.

Leave a Reply

Your email address will not be published. Required fields are marked *