Taking some cash off the table

The Fortis price has surpassed its old high for the year ($61.46). A check of its target price shows Fortis to have also surpassed that goal as well. At the present price ($61.84) the Fortis dividend yield has slipped to only 3.847%. This is less than the 4% I look for in a stock holding. I can earn almost as much from a money market fund: 3.8%. I am lightening my exposure to Fortis.

When CIBC split and tumbled in price, both action occured at approximately the same time, I picked up some shares of CIBC with the goal of making a little money come the inevitable turnaround. It has turned around and I have now sold 300 of those shares. 

TransCanada Pipeline (TRP) has been on a roll for some months. It has surpassed its high for the year but it is still down considerably from the height attained by it historic highs more than a year ago. It may regain its old highs but I was happy to part with a few hundred shares at the present price. 

The iShares ETF XUS split a few weeks ago. It had doubled in price since my purchase, and now, at the new price thanks to the split, I feel comfortable dumping a few hundred shares. On the next dip, I will buy more of this ETF than I just sold. One does not want to be underexposed to the American market for too long. I am hoping a correction is coming --- and soon.

The markets have been on quite the roll and despite my lighting my equity load, I am still more exposed to the market than at almost any other time in my life. If the market continues to climb, I will rewarded. If the market pulls back, I have some cash to take advantage of the correction.

Highest yielding stocks for RRSPs

 I love dividends. In fact, I could not balance my books without them. Dividends keep my retirement world spinning comfortably. Today, I read a piece on the highest yielding stocks on the TSX. I was amazed at how many of these stocks many retired seniors have in their income portfolios. The following is a partial list:

• BCE Inc
• Telus Corp
• Enbridge Inc
• TC Energy Corp
• Bank of Nova Scotia
• Power Corp of Canada
• Cogeco Communications Inc
• Bank of Montreal
• Pembina Pipeline
• Brookfield Infrastructure PA
• Toronto Dominion Bank
• Algonquin Power & Utilities
• Nutrien
• Canadian Imperial Bank of Commerce
• Fortis Inc
• National Bank of Canada
• Altagas Ltd
• Royal Bank
• Brookfield Corp

I own, or have owned, almost all of the above at one time or another in my retirement portfolio. I lost a lot of my investment cash by owning any telecom, but especially BCE and Telus, but I have no doubt that the prices will recover. In the meantime, I will be collecting very nice dividends from each telecom in my portfolio.

Pipelines have been solid performers when it comes to dividends but they, like the telecoms, have gone through a very down period. Luckily, all my pipelines seem to be recovering nicely. If and when the pipelines retreat, I would buy if I did not have my investment goals already filled.

The Canadian banks have been long term favourites among retiree investors. Today the banks are on a roll. This means the yield is down today but if you bought low you are enjoying a good dividend plus a nice pop on your principal. For many of us, the banks have been a win-win proposition. 

Utilities are another investment favoured by Canadian retirees. I got into both Fortis and Emera at the urging of a retired friend. Algonquin Power was my own decision. I blew it. I bought too early. Today, two dividend reductions later, Algonquin is looking like a buy and hold. Watch for a price lower than $7 and then check why it is down and if it not a serious issue, buy and hold. Algonquin holds promise when held into the long term.

The market is well off its lows today. In fact, it is hitting new highs. I refuse to advise timing the market but my gut tells me if there was ever a time to time the market that time is now. I confess, I am growing my cash holdings in anticipation of a correction. I also confess that I have been wrong before.

Is it time to take some profits?

The market is up. It is off its highest highs but it is still up. Is it time to take some profits off the table?

For years I have simply practised buy-and-hold. Oh, I have been known to sell a little but not nearly enough. For instance, I held a lot of Nutrien when it was selling for about $145. I should have sold three quarters of my holdings but I didn't. By the time I sold, Nutrien was selling for $75. My tardiness cost me tens of thousands of dollars.

The money market fund I in which I park my cash, is no longer paying interest of four percent or more. Still, I am going to sell some of my portfolio and keep the cash in a money market fund (TDB8150). The hard decision here is what exactly do I sell?

I'm leaning to selling stock that yields less than the interest earned by cash in a money market fund. I am also considering parting with some of my stock that is selling for more than its target price.

If there is a downturn coming in the next 12 months, I will be ready to take advantage of any bargains being offered in the stock market.

Algoma Central Corporation Is Eye-catching

Algoma Central Corportation (ALC) is eye-catching, at least when it comes to my eyes. I became aware of ALC when I worked at a small newspaper in Sault Ste. Marie, Ontario. A lot of companies with Algoma in their name had their roots in the Sault. Algoma Central Corporation was one of them.

Algoma Central operates the largest fleet on the Great Lakes and it has interests in ocean shipping as well. To an outsider, like me, it seems well positioned within the marine transportation logistics sector.

One downside to ALC is the cyclical nature of the shipping business but to an investor with a positive outlook this volatility means this is a stock that can be bought low and sold high repeatedly. I'm a positive investor. I like volatility.

As my interest in ALC grew, I decided to see who exactly has money in this shipping company. I discovered the Jackman family of Toronto holds something like 27% of the business through their large interest in E-L Financial Corporation. 

But that is not the end of the Jackman family interest in ALC. The Jackmans, I believe, also own a controlling interest in Amogla Holdings and Amogla Holdings holds about 30% of the ALC stock. E-L Financial and Amogla Holdings together own something in the neighbourhood of 57% of the ALC stock.

The third biggest shareholder is Macquarie Investment Management Limited. This is an Australian company committed to sustainable investing with the aim of delivering excellent long-term results to its clients. Is it working? You better believe it. With a staff of more than 20,000 worldwide, Macquarie reported a net profit after tax of  $3.522 billion U.S., for the 55th consecutive year of profitability.

The more I looked into ALC the more I liked it. But, I am a dividend investor. Is ALC the right fit for my style of investing? It has a dividend yield of 5.33% today. Nice, and it is worth noting that the company has a history of increasing its quarterly dividend. A further bonus, ALC has paid a special dividend in three of the past five years. Since 2018 ALC has paid a special dividend of  $4.75 per share.

Algoma Central Corporation's low valuation with a focus on debt reduction, its growing dividend yield, and its strategic, global fleet expansion all say "buy" to me.