So far, this year has been a time of climbing values. I am up almost a percent and a half since the year began. I can remove enough money from my portfolio to keep bread on my table and heat in my home and still have a portfolio balance larger than I started with at the beginning of January.
So, why the talk of a correction? Because, a correction will occur and when it does you want to be in a mindset to suffer the temporary setback. My portfolio spreadsheet sees seven percent growth every year as my goal. It factors in a reduction in value of based on my estimated RSP withdrawals which I must make in order to pay my bills in retirement. It then tells me what my portfolio would be worth at the end of the year in a perfect world.
Well, in recent years the world has been meta perfect. I'm up just more than 40 percent over my stated goal. This means that I am prepared for a 40 percent correction. This would simply bring my portfolio value in line with my oh-so-positive predicted value.
If I can play the market well, selling before I bottom, all well and good but I know that historically I have not been good at recognizing bottoms. I tend to buy in a falling market and not sell. I'm always thinking that today is the bottom.
It is funny. I never think that today is the top. There is always more to come. I guess I'm the eternal optimist who believes in the occasional correction. It is a good mindset if one is going to put all their retirement funds into the market.
DPF.UN as a possible investment
Now, is there anything that I am looking at as a potential place to stash a little cash? Yes: DPF.UN on the Toronto exchange. This is a closed end fund selling at $3.77. This is quite a drop from its IPO price of $10. Plus, it often sells for less than its NAV.
So, what attracted me? Well, I saw an article in the Globe and Mail that alerted me to its existence. I've had it on my watch list every since. With DPF.UN offering a yield of 13.8 percent, and with me having some dividend cash available, DPF.UN is looking more and more like a fun little play. I won't put too much in, so I can't lose my shirt (I might lose a button or two), but it promises to give a small but nice boost to my dividend income.
DPF India Opportunities Ord can be found on the Morningstar site.