Dividend stocks portfolio – Recent Changes – March 2020

Intro..

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

Up until February 2020, I was a net-buyer. I kept purchasing income-producing assets to build passive income, so I was dreaming of reaching financial freedom in the next few years.

But, everything has changed in a matter of weeks due to the current unprecedented situation.

Almost none of us have experienced or imagined these type scenarios in our lifetime.

Countries’ unemployment rate rapidly moved from multi-decade low to record high in a matter of weeks.

Consumer sentiments changed from record high to record low in a week.

So many businesses are with zero revenue, and they have been struggling to handle their fixed expenses.

Real-estates were considered as a safest investment a few weeks ago, but now the sector is struggling to collect rents and handle their fixed expenses.

Governments and central banks have reacted with significant monetary and fiscal interventions designed to protect businesses, people and the economy.

As a result, global equity markets have experienced significant volatility and weakness.

My dividend portfolio is not immunized to handle these types of volatility. I have never experienced this type of swing in my lifetime, neither none of you.

One day my portfolio dropped over 10% or dropped by over $35000 in a single day, and the next day it gained over $30 000. The amount is almost equal to my net yearly salary from my day job.

In the top of that, I am a leveraged investor. I borrow money to invest. As you know, leverage accelerates the gains and losses.

Thus, I was experiencing an even high degree of volatilities than ordinary investors.

Leverage investing is like a loaded gun. If we use it correctly, then it helps, but if we don’t know how to use it, then it may kill us.

On Monday, March 9, my investment took a massive hit due to the oil crash, which made me even more worries.

Even though I don’t have any oil producers in my portfolio, the panic created by the oil crash brought down all stocks.

One of my margin accounts was able to handle only about 20% of the market drop from the day.

At the time, I had enough credits from HELOC and other credit lines to protect my margin loans for another 70% to 80% drop. I would have used them, but I didn’t this time.

Because there were so many uncertainties surrounding every aspect of our life.

I may need the money for any emergency needs, or I may need the money to help families and relatives. So, I decided not to use the credits at this time.

And, I made a difficult decision to sell some slow-moving assets to protect my margin loans.

The next day, March 10, I sold around $70 000 worth of stocks from my Canadian portfolio and reduced debts by the same amount.

Most of the stocks I sold are from the defensive sector, such as utilities and pipelines.

Those stocks were holding up their value at the time. I decided to sell them because they are slow movers so I can repurchase them later day when I have enough funds.

It was the hardest decision I made in my financial journey. I was prepared for high market volatility, recession, etc.

But, I did not prepare for these types of scenarios – like a business with zero revenue.

Besides, I sold some stocks in my TFSA account (XRE.TO and CAR.UN) and purchased some Canadian dollar hedged U.S dividend stocks ETFs (ZUD.TO and VGX.TO).

A few days later, I purchased back a couple of stocks I sold earlier for a much lower price, as I received a few thousand dollars tax refunds because of my RRSP contribution.

For sure, I will be buying back all (at least most of them) the stocks I sold, but with extra caution.

Honestly, I did not intend to sell high and repurchase them at a lower price. I am a long-term buy and hold dividend investor—my intention to collect growing dividends than trading stocks.

Most them were my favourite long-term holdings. I will buy them back, for sure.

But, It will be a slow but steady approach.

Triggered capital gain tax

Almost all the stocks I sold were purchased for a much lower price (average purchased prices); the only exception was KPT.TO.

Therefore, I will need to pay tax for the capital gains for the current year.

However, I have some rooms for RRSP contributions. So, somehow I may able to minimize the tax by contributing my RRSP accounts.

Plus, I missed updating my net-worth update report last month because I was extremely busy at my work.

As many of you predict, it will be an ugly report. I will post everything about it in my next net-worth update. I have nothing to hide.

I started to invest in stocks a few years after the 2008-2009 financial crash.

Therefore, this is my first most massive crash. I am learning a lot and getting valuable experience from this current situation.

In the future, nobody needs to teach me how massive crash will look like and how to handle it. I have been learning from my own experience.

In addition, a reader asked me if I am changing my investment strategy after this crash. My answer is NO.

I am not going to change my investment strategy because of these crises. I don’t know any other investment strategy, other than the one I follow.

Every time I experience a setback, I learn from it and move forward stronger than ever. I will do it the same this time as well.

I understand that this is a highly stressful time, health-wise and financially. If you are experiencing the same, then it is very normal.

Every human on this earth is going through the crisis. You or I am not alone.

There will be an end for everything. We will go through this and come out on the other side stronger than ever before.

Meanwhile, let’s follow what our local government officials are advising and reduce the burden on our front-line workers and save our elder people who helped to build this country as a better place to live.

Here are the changes I made in my dividend portfolios in March 2020:

Disclaimer..

Please note the information posted on this website is the opinion of my own and should not be considered as professional financial advice. I am not a financial professional, and I can buy, sell, or hold any investment at any time.

Any transactions I publish on this website are not recommendations to buy or sell any securities or investments.

Please do your own research or consult with a qualified financial professional before even considering using the information obtained from this website.

The changes made in my Canadian portfolio in March 2020.

• Sold 30 units of CAR.UN at $50.70
• Sold 150 units of XRE at $16.77
• Sold 100 shares of KPT at $11.09
• Sold 100 shares H (Hydro-one) at $26.62
• Sold 230 shares of FTS at $55.20
• Sold 250 shares of CU at $37.70
• Sold 90 shares of EMA at $55.60
• Sold 190 shares BCE at $59.60
• Sold 380 shares of T (Telus) at $23.88 (split-adjusted)
• Sold 340 shares of AQN at $19.90
• Sold 175 shares of TRP at $62.58

Later

• Added 30 shares of T (Telus ) at $20.88
• Added 20 shares of EMA at $43.95
• Added 20 shares of CHP.UN at $11.50

The changes made in my U.S dividend portfolio in March 2020.

• sold 15 shares of CVS at $55.25
• added 13 units of DGRO at $31.00
• added 6 units of SDY at $79.00
• added 55 units of ZUD (Canadian hedged) U.S Dividend ETF at $18.56 (averaged pirce)
• added 91 units of VGH (Canadian hedged) U.S Dividend ETF at $34.62

The changes made in my International dividend portfolio in March 2020.

• added 1 unit of ZDH (Canadian hedged)at $20.78
• added 1 unit of IDV at $23.28

Due to recent changes my yearly estimated passive income (EPI) down from $12 493 to $9333 in March 2020.

I have updated the portfolio pages with these changes.

Commission FREE ETF purchases

Are you wondering how I can execute small orders of ETSs? Thinking about commission fees?

Actually, I use Questrade for all my ETFs purchases. There are no commission fees for ETFs purchases at Questrade. Therefore, we could buy one or any number of ETFs without paying any commission fees.

This is a great way to deploy cash and invest for more cash-flow as soon as they come in.

For those looking to start investing with little money, Questrade is one of the good options to consider because of their commission-free ETF program and minimum requirements to open an account.

If you have a plan to open an account with Questrade, please accept my gift and take advantage of this $50 trade commission rebate.

There is a trading charge of $4.95 when you sell ETFs. All the details are at the time of writing. If you have a plan to open an account at Questrade, please check all the information (including current commission fees) on their website and see if it is suitable online brokerage for your needs.

Disclosure: This post contains affiliate link. Therefore, I will earn a commission if you use the links to buy products or services (at no additional cost to you).

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