Thursday, October 29, 2015

I switched from TD Monthly Income to TD Monthly Income

So far, the TD Monthly Income has been a better option than annuities for me.
Although some of the sparkle has dimmed when it comes the the TD Monthly Income fund (TDB622), it is still a fair place for a retiree to park a chunk of portfolio money. (See the above screen grab.) Combine TDB622 with a lesser amount of the TD U.S. Index Fund-e (TDB902) and one has the beginnings of a fine portfolio with very good allocation and no great amount of investment knowledge necessary.

This approach has gotten even better. TD is now offering D-series funds to investors with TD self-directed accounts. These funds have lower than usual management fees because the trailing commissions are restricted to .25%. Do-it-yourself investors shouldn't be paying big trailer fees for advice they neither need nor receive. One could argue that even at just a quarter of a percent, this charge is still a little steep. These funds are only available to investors with TD self-directed accounts.

Yesterday I switched from I-series TDB622 to D-series TDB3085. One call to TD Waterhouse is all it took. There was no charge. All quite simple. I understand I will now spend about 30 percent less in management fees. The old TDB622 was not all that expensive with a MER of about 1.48 percent but the new D-series TDB3085 shaves a little off that. I may pay about one percent when all is said and done.

I have owned TDB622 for many years and it has been a good, solid performer. There are funds that have done better but not many are as dependable and in retirement dependable is important. In the recent past I have been taking my own advice and adding some TDB902 to the mix. So far this is proving very satisfying and very profitable as the U.S. market is on a roll.

Wednesday, October 28, 2015

I buy and hold but I don't always hold the same stuff

Awhile back I bought some Chartwell Retirement Residences (CSH.UN) It paid a nice dividend, it is still paying about 4.36% today, and it climbed in value nicely. Today I sold my Chartwell holdings for a tidy profit of well into the four figures.

But I cannot get buy without income. This is a given. I cannot sit on the sidelines with too much cash for too long. I'm retired and forgoing too much income is not an option. I reinvested my funds in H&R REIT (HR.UN). This well respected REIT is yielding about 6.34% at the moment.

And I reinvested a touch more than I originally had invested in Chartwell. My income has taken a small bump into the black. The icing on the cake is that I believe H&R has more upside potential than Chartwell. Over the coming year I hope to make more holding H&R than Chartwell. I did well with Chartwell and I believe it was time to head for the exit.

Now, I may add a hundred shares to my D.UN holdings. Dream Office has not preformed as I had hoped. It is well off its highs and no one sees it hitting the targets that had been once been bandied about for this holding. A new purchase will bring my average price paid down considerably and make it possible to sell for a profit in the near future. Most claim the dividend is safe but whenever a yield climbs above ten percent, I get concerned. Still I will enjoy the dividend while I can and hope to make a profit in the end.

My bid for D.UN has not been attracted any sellers. The going price has climbed a couple of cents above my bid. Oh well, D.UN rarely makes a clean climb. I'll wait and hope to make my purchase on a small dip.

Tuesday, October 27, 2015

Buying more on any big dips

I'm watching for another dip in the Dream Office REIT share price. I may pick up another 100 shares. This would mean a monthly payment of about $112 as long as the dividend isn't cut. I'm betting it is safe in the short term.

D.UN is a long term hold for me. Even with a dividend cut, this REIT rewards me for my patience. I need cash flow and this holding answers some of that pressing need. Retirees cannot live on promised capital gains. Dividends are wonderful.

Saturday, October 24, 2015

Corrections are your friend

Despite the fear mongering in the media, corrections are normal and beneficial.

Recently the market had a correction. In fact, it still has not fully recovered. The media, as usual, reported this correction as a horror story. A number of reports said retirees who were heavily invested in the market lost millions. It was a disaster on a massive scale, according to these media fear mongers.

All not true, unless one was forced to liquidate at exactly the moment when the correction maxed out.

I was lucky. I had some cash on hand. Cash during a crash is nice. I bought some battered stocks and sat back and waited. I was confident I had bought some good stocks at fire sale prices. As you can see from the green line in the graph, my hunches were good and so far I am coming out on top.

I believe one should always keep a little cash on hand to take advantages of brief corrections.

Of course, not all corrections are short. Sometimes the market grows too fast, it becomes frothy, unstable, and tumbles from its greed-driven heights. If you bought a lot of stock during the feeding frenzy period, your pain may be a long time healing. But, even in this case the correction is your friend. It represents a return to sanity. A return to fair, even slightly conservative pricing of equities. Search out the good companies, the good stocks, and buy for the long term at these times. Over time the almost certain steady growth in value of your portfolio will reward you.

I have been in and out of the market all my life and in retrospect I would have done better if I had stayed the course and stayed fully invested at all times. I learned too late that corrections are opportunities not to be missed.