Introduction
In June 2014, I built a low cost model ETF portfolio, using an imaginary $10,000, that could generate positive cash for long run with long-term growth. As mentioned, I will review the portfolio performance every month and re-balance it to meet the target assets allocations.
At inception, the portfolio’s projected annual income was $342.86, for a yield of 3.43% based on the initial value of $10 000.
Last month dividend/distribution
The portfolio has generated $16.90 dividend/distribution since the last update.
Total dividend/distribution received so far is $93.76
Current portfolio with dividend income
Here’s how the portfolio is now after the close of trading on August 15, 2014. Canadian and U.S. dollars are treated same as being at par for purposes of the calculations.
| ETF | # | Price | Total | Current % | Target % |
|---|---|---|---|---|---|
| XQB | 73 | $20.64 | $1,506.72 | 15.04% | 15.00% |
| CBO | 76 | $19.72 | $1,498.72 | 14.96% | 15.00% |
| ZPR | 15 | $14.3 | $214.50 | 2.14% | 2.00% |
| XPF | 16 | $19.85 | $317.6 | 3.17% | 3.00% |
| XRE | 13 | $16.56 | $215.28 | 2.15% | 2.00% |
| CGR | 13 | $23.80 | $309.40 | 3.09% | 3.00% |
| CDZ | 75 | $26.82 | $2011.50 | 20.08% | 20.00% |
| SDY | 26 | $75.24 | $1,956.24 | 19.53% | 20.00% |
| IDV | 51 | $38.35 | $1,955.85 | 19.53% | 20.00% |
| Cash | $29.36 | 0.29% | 0.00% |
Rebalance
I will rebalance this portfolio every month with cash flow; therefore, I will simply add ETFs to meet the targeted assets allocation by reinvesting the cash generate by the portfolio.
From the table above, we could clearly see that ‘International Select Dividend ETF (IDV)’ and ‘SPDR S&P Dividend (SDY)’ have lost some value and little off from the target allocation. However, we don’t have enough fund to buy these ETFs. Thus, I will add one unit of ‘Laddered Corporate Bond Index (CBO)’
Current portfolio
Here is what the current portfolio looks like as of August 17, 2014. Now the projected annual income is increased by $0.83 to $347.01.
| ETF | # | Price | Total | Current % | Target % |
|---|---|---|---|---|---|
| XQB | 73 | $20.64 | $1,506.72 | 15.04% | 15.00% |
| *CBO | 77 | $19.72 | $1,518.44 | 15.13% | 15.00% |
| ZPR | 15 | $14.3 | $214.50 | 2.14% | 2.00% |
| XPF | 16 | $19.85 | $317.6 | 3.17% | 3.00% |
| XRE | 13 | $16.56 | $215.28 | 2.15% | 2.00% |
| CGR | 13 | $23.80 | $309.40 | 3.09% | 3.00% |
| CDZ | 75 | $26.82 | $2011.50 | 20.08% | 20.00% |
| SDY | 26 | $75.24 | $1,956.24 | 19.53% | 20.00% |
| IDV | 51 | $38.35 | $1,955.85 | 19.53% | 20.00% |
| Cash | $9.64 | 0.10% | 0.00% |
*Updated
Conclusion
The portfolio doesn’t gain any value so far, gained $15..17 so far; however, it hard to conclude the results in one month as the model portfolio was designed for long-term.
Check the latest portfolio status update here.
Again, this is not a recommendation to buy or sell stocks; it is an experiment to see the performance of well diversified ETFs portfolio. Also, I assumed is no commission to purchase ETFs.
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