Tuesday, January 13, 2009

My DRiP Portfolio

I often mention my DRiP portfolio, but I realized the other day that I've never taken the time to list the companies that it contains. Well, now is the time to fix that omission:
  • Bank of Nova Scotia (Toronto: BNS) -- 19%
  • Bank of Montreal (Toronto: BMO) -- 5 %
  • Aberdeen Asia-Pacific Income Inv. Co. (Toronto: FAP) -- 17%
  • Canadian General Investments Limited (Toronto: CGI) -- 6%
  • Telus (Toronto: T.A) -- 5%
  • Fortis (Toronto: FTS) -- 10%
  • TransAlta (Toronto: TA) -- 2%
  • Enbridge (Toronto: ENB) -- 3%
  • TransCanada Corp. (Toronto: TRP) -- 6%
  • Imperial Oil (Toronto: IMO) -- 2%
  • Suncor (Toronto: SU) -- 1%
  • Pengrowth Energy Trust (Toronto: PGF.UN) -- 1%
  • H&R REIT (Toronto: HR.UN) -- 5%
  • RioCan REIT (Toronto: REI.UN) -- 1%
  • Johnson and Johnson (NYSE: JNJ) -- 16%
  • Pfizer (NYSE: PFE) -- 1%
  • 3M Company (NYSE: MMM) -- 2%

(You will notice that the total is over 100% -- that's because of rounding errors.)

So I have a total of 17 companies in my DRiP. Most of these are Canadian, because those were the easiest to start and send money to, but as you can see I have started adding some U.S. companies to the mix. I plan on adding more of these, essentially in sectors that are not represented in the Canadian stock market. My prime targets for expension of my portfolio are Pepsi (NYSE: PEP) and Procter & Gamble (NYSE: PG).

My companies (I like saying that) are divided by sectors as follow:

  • Financials (BNS, BMO) -- 24%
  • Fixed Income (FAP) -- 17%
  • Technology and Telecom (T.A) -- 5%
  • Energy and Pipelines (FTS, TA, ENB, TRP) -- 21%
  • Oil & Gas (IMO, SU, PGF.UN) -- 4%
  • Real Estate (HR.UN, REI.U) -- 5%
  • Health (JNJ, PFE) -- 17%
  • Industrial (MMM) -- 2%
  • Others (CGI) -- 6%

So, you can see that this is not exactly a balanced portfolio (although it isn't too bad). I am overweight in financials and energy, but that's a common theme in Canadian markets, while I am underweight in consumer products (which is completely absent) and industrials.

But since I look at all my portfolios when assessing my diversification, the goal is not to keep a balanced DRiP portfolio, but rather to keep a balanced overall portfolio. I hold more consumer products and industrials in my RRSP accounts, as well as additional fixed income products. That allows me to optimize my taxes, since foreign dividends and interests are taxed less favourably than Canadian dividends. Eventually, I will hold some of my companies in a self-directed TFSA account, for the same reasons.

1 comment:

Anonymous said...

I always inspired by you, your opinion and attitude, again, thanks for this nice post.

- Norman