TD was one of my core holdings. I was content to hold TD and happy to add to my holdings when the price dropped. Adding to my holdings was a mistake. The market was onto something that I was not: TD was in deep legal trouble in the United States. The second biggest Canadian bank has now put aside hundreds of millions of dollars in anticipation of some damn big fines related to money laundering accusations in the States.
TD is still a core holding of mine. I cannot afford to sell it and as I had no intention to sell, the pain is mitigated. I will hold onto my stock and pocket the 5. 43% dividend. My guess is that the dividend is still safe. TD has gotten enough bad press. It does not have to soil its reputation with its first dividend reduction in its long history.
If you hold TD, as I do, your losses may be around a long time, and keep holding. If you are a value investor, move with care. TD may be facing fines of $1.5 billion U.S. plus annual remediation costs in the hundreds of millions stretched over about four years. The painful scenario appears to be already priced into the price of the stock but have both shoes dropped? I am not so sure.
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