The main purpose of updating our investment portfolio in 2019 is to dry up our holdings wherever possible and sell stocks that we cannot dry out in the near future. We still have some stocks that we haven’t distilled yet:
- Chevron (CVX)
- International Restaurant Brands (QSR)
- Delta Airlines (DAL)
- Vanguard All-Cap Index ETF (TSX:VCN)
- Domino’s Pizza Inc (DPZ)
- Amgen Corporation (AMGN)
- Boeing Company (BA)
- Prairie Sky Royalty Limited (PSK.TO)
- Marathon Petroleum Company (MPC)
Currently, we are not paring 9 of our 31 holdings. In most cases, the reason is the high stock price.
Stock price rise
In order to be able to acquire DRIP shares, the dividends received must exceed the price of at least one share. If the stock price is high, there is a need to obtain sufficient profits. For example, if the stock price is $100 and the annual dividend yield is 4%, you would need to invest $10,000 to cover the $100 quarterly DRIP.
Some of our non-DRIP holdings have a high share price:
- Chevron (CVX) $121.59
- Domino’s Pizza Inc. (DPZ) $274.28
- Amgen Inc. (AMGN) $168.77
- Boeing (BA) $344.05
All the companies mentioned above are doing well, and we are gradually buying more shares. Regarding how Boeing has performed well recently, I agree that this is debatable, but I still tend to believe that this company will emerge stronger from its current crisis.
Inherited shares
Two companies on the list entered our portfolio through acquisitions of companies we previously owned, and as a result the shares we owned were replaced with shares of the new company:
- Marathon Petroleum Corp (MPC)
- Prairiesky Royalty Limited (PSK)
Both are from the energy sector and are in the red in our portfolio. The energy sector represents about 15% of our investment portfolio, and given current oil prices, I doubt we would want to maintain this exposure to this sector.
In addition, according to our assessment, these two items have become our worst-performing assets. We have not sold this property, but it would certainly be the first to find a way out of our portfolio.
As for PSK, we are not happy with the performance of this asset, and because we are reducing our exposure to the oil sector, we sold our 100 shares.
Increasing holdings
We purchased an additional 40 shares of Genworth MI Canada (MIC). This company continues to please its investors. This year alone we took a special dividend of $784 from this company. Special dividends exceed their regular distribution.
We added 10 shares of British Airways to our position on March 11. Although the company is working to regain customer confidence, it increased dividends by 20.18% in 2019.
We added 40 shares of Canadian National Resources (CNQ) in July. The company increased dividends by 11.94% this year.
We added seven shares of Domino’s Pizza (DPZ) on July 16.
We purchased 60 shares of Restaurant Brands International Inc. (QSR) to enable DRIP for a single share.
On September 10, we bought 242 shares of Dream Global REIT (DRG-UN.TO).
New arrivals this year
We bought 75 shares of Delta Air Lines at $63.48 in January and then added 88 shares during the year. This is our first investment in the airline.
Furthermore, I found 80 Enbridge Inc. stocks. (ENB.TO) has made its way into our investment portfolio. We couldn’t pass on the attractive dividend of about 6% from this company.
We bought 250 shares of RioCan Real Estate Investment Trust (REI.UN). After Blackstone acquired DRG-UN.TO in an all-cash transaction, we gained 51% of our holdings in DRG-UN.TO. We used this money to get our first place in REI-UN.TO.
Sell only one asset
During 2019, we sold only one of our properties: PSK. We tend to keep our portfolio long and not short, but sometimes, after holding an asset for several years and not seeing any improvement, we sell. According to our evaluation process, PSK was our worst investment after holding on to it for about four years. We want to increase our holdings of well-performing assets, such as MIC, DPZ, QSR, CNQ, BA and DRG-UN.TO REIT, so this year we decided to reduce assets that did not perform well.