Dividend stocks portfolio – diversification strategic and recent purchases – April 2016

For those of you new to this website, in this post, I discuss the recent changes I made in my dividend portfolios and also discuss about my portfolio diversification strategies.

Toronto Stock market was pretty much flat last month.

I just made one major purchase in my non-registered account, and also reinvested some dividend and purchased few other stocks and ETFs in my registered accounts.

I see some improvements in Canadian dollar recently. I may start purchasing some U.S stocks if Canadian dollar continues to move up. Because I have to make very serious move to diversify my portfolio.

Now let’s see the recent changes in my dividend portfolios in April 2016.

Please note this is not an investment recommendation website and I am not your financial Advisor. I am just sharing my personal financial journey with this website readers. I strongly recommend you to discuss with a financial professional before make any investment decision.

The changes made in Canadian portfolio in April 2016.

• added 8 shares of BIP.UN at $53.54
• added 3 units of XRE ETF at $15.82
• initiated HydroOne – purchased 100 shares of H at $23.39

The changes made in U.S dividend portfolio in April 2016.

• initiated a tiny position in INTC – purchased 5 shares at $32.35
I have very tiny percentage of technology stocks. I will make few purchases in technology sector in order to diversify my holdings.

I have updated the portfolio pages with these changes.

So many readers asked me which brokerage account I use and how much commission I pay for each trade I make.

Obviously it is very common question because I make very small purchases every month.

Actually I use Questrade for all ETFs and tiny stock purchases.

So, whenever I get some dividend income I don’t let the cash to sit my account. I usually send them immediately to make more money by purchasing ETFs at no commission fee.

Therefore, you could buy any ETF for free of commission at Questrade.

Also, their commission for purchasing common stocks is very low compare to other stock brokerages – which is $4.95 compare to $9.99 in other brokerages.

For new and experience investors, Questrade is one of the best brokerages pick. I could tell this because I am using Questrade for more than 4 years.

If you are planning to open a new account at Questrade, please use the like below to register and get $50 in free trades promo offer.

Open Questrade and get $50 in Free trades

I always believe in transparency so I am disclosing that I will get a small affiliate commission if you use the above a link to register (at no additional cost to you).

It is a win-win situation. You receive a promo offer of $50 when you use above link and I receive a commission for referral. A small compensation from you for valuable information and inspiration I provide here for free.

Again, you could buy any ETF for free of commission at Questrade.

Take advantage of this promo offer of $50 and start your financial freedom journey with as low as $1000 initial investment.

Now, let’s look my portfolio diversification.

Portfolio diversification

Again and again, I will be the first to admit that a significant portion of my portfolio is built with Canadian dividend paying companies – most of the companies and their services I use or experience in my daily life.

But, when it comes to diversification I’ll be the also the first to admit that my portfolio is very poorly diversified – geographic wise and sectors wise.

More than 80% of my investments are in Canadian based companies. I was kept adding more Canadian stocks to take advantage of recent market drops.

I have created a diversification strategic for my portfolios to minimize the investment risks, but I am not following my own strategic as I am still in asset accumulation stage 🙂 .

Recent changes in my diversification strategic

In March 2016, increased my fixed income target asset allocation to 20% and reduced International stocks target asset allocation to 5%.

January 2016 – I have included my employer pension into fixed income category. The contribution I make into ,my employer pension plan is part of my assets, and it will definitely fit into the fixed income category.

Portfolio Geographical Diversification

My Canadian portion of my investments have increased a bit from my last update due to the recent purchases I made.

Portfolio diversification – sectors & fixed income

Actually, (I guess) there are only 10 sectors, but I have divided my dream portfolio by 15 sectors including fixed income/bonds/employer pension.

Please note this is not the way professional fund managers or experts diversify their funds. This is my own diversification strategy.

From the above table, you could easily see my poor portfolio diversification. Finance, pipelines and utilities are almost 50% of my total value. It is very risk approach!.

It is a big mistake I make now. But I have no choice as I am unable to move my Canadian dollars into U.S market to diversify due to the currency exchange rate.

However, I won’t sell holdings from over weighted sector and buy in under weighted sectors. But, I will try to balance my holdings by adding new units in the under weighted sectors.

This is the first strategy I developed for my portfolio diversification. It will evolve over time with the world economic conditions and my risk tolerance.

I will update my progress every month under the portfolio updates category.

Many readers asked me which tools I use for all these calculations.

Actually, I use Google Sheet which is available in the Google drive. It is free. All you need is a Google account.

Google Sheet is very similar to MS Excel but you could pull the stock market data from Google Finance to do all the calculations you need.

Do you have any diversification strategy? And how often you balance your portfolio?