Dividend Income - June 2013

By Category: Dividend Income | 3 comments

Dividend IncomeTime to review my dividend income for June 2013. I have not participated in the “Sell in May & Go Away” philosophy that the media covers annually… Selling would mean not receiving my dividends and it would certainly slow down my compound growth.

Dividend Income

My June dividend income is $574.98. It includes the dividend increase from many of my US Dividend Aristocrats. It looks like June is when I will be getting my pay raise :)

I have not had a chance to do my TFSA contribution yet this year. I will manage to do it but multiple competing priorities come into play. I always contribute to my employer RRSP first as I get a matching contribution form my employer at a minimum of 50%. It’s an easy decision when you can make 50% on your money within a year.

My taxes are so efficiently managed up front now that I need to over-contribute to my RRSP to ensure I don’t pay taxes again

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How To Profit from the Netflix Effect

By Category: How To, Investing, Telecom | One comment

NeflixIs the cable landscape going to be different for the future generations? These days, my kids and me mostly watch Netflix on a computer or on TV using one of the many devices out there. It’s clear that watching television or actually keeping up with your favorite shows is changing. Just like many other mediums that have changed before the cable such as newspaper, magazines and telephones, the cable, or the way we watch television, is changing. Advertisers need to adjust and adapt as well.

Related: Is Netflix the next cable model?

How To Profit From the Changing Cable Models

Conservative Investing Model

One aspect that Cable and Internet television have in common is that they both need to get data to your home. It’s plain and simple as you need the image and the audio. The latest in technology is Fiber Optic cable and it is becoming the standard installation in many new development. Fiber Optic is not new though from a technology perspective so there is nothing exciting here.

The conservative model I am referring to is the Internet Service Providers (ISP for

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Investing Conflicts? Understand Your Investment vs International Allocation

By Category: Asset Allocation, Investing | 2 comments

Rebalance OptionsI have come to realize that there exists many conflicts in investing that many investors have to work through. I am an avid reader of Money Sense and Canadian Business and they often review portfolios and offer guidance for the readers. Often times, the rule book is thrown at the portfolio which follows different asset allocation strategies including international and emerging market investments.

On the other side of the coin, you start hearing that you are in charge of your portfolio and you should be aware of what your investments are, the fees and educate yourself since you are ultimately responsible for your portfolio.

Related: How To Track Your Asset Allocations

International Allocation Goals

The goal with international allocation is to spread your risks by not focusing on just one market. As a Canadian, we are often told that the Canadian market is small and it’s a big world of opportunities out there. I agree and that’s why I invest in the US markets as well. It’s the biggest economy after all. It’s technically considered international but the US economy is heavily tied to the Canadian economy

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Understanding Income Tax on ESPP

By Category: ESPP, Income Tax | 3 comments

Understand ESPPUnderstanding the income tax treatment on ESPP (Employee Stock Purchase Plan) can be a little confusing at times. You essentially purchase your shares at 2 different prices:

  • The actual price you pay for the stock (usually including a discount price from your employer)
  • The market price of the stock on that day

It’s important that you understand both in order to do your taxes. The ESPP is a benefit from your employer. Every benefits are taxed at your marginal tax rate in Canada. The capital gains on a stock is from your purchase of stock usually done with after tax money.

Related: ESPP – When Should You Sell?

ESPP Benefit Explained

The benefit you get from your employer is not the ability to purchase the stock but the ability to purchase the stock at a discount. The discount part is taxed at your marginal tax rate.

For example, company ABC trades at $20 on the day of purchase. That’s your market price of the ABC stock. If your employer has a 20% discount for you, you pay $16 for the ABC stock.

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Dividend Stock Research - Spot the Bad Investments

By Category: Dividend Stock Analysis | One comment

Foreign Exchange

As we’ve discussed in earlier posts on Dividend Stock Research, there are many sources of information on purchasing dividend stocks. But buying a winning stock is just the first step in successful dividend investing. Knowing when to sell is just as important.

A disciplined approach to selling would involve liquidating your stocks based on pre-determined price targets. Many investors choose to sell their equity holdings based on these targets. For example, let’s say you bought a stock at $20.00. Based on your research, the stock should be valued at $27.00. Once the stock hits that price point, you would liquidate the stock and lock in your profits. Of course, before liquidating at $27, it would make sense to re-evaluate fundamentals to see if the stock has a new valuation.

Other dividend stock holders choose to employ a “buy and hold forever” strategy. However, blindly holding onto a stock for many years may not always be the best strategy with the amount of volatility in the markets today. And even if you choose to hold your stocks for the long-term, it’s still important to be on the lookout

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