Friday, October 26, 2007

portfolio update (non-registered)

Here is a summary of my allocation within my non-registered stock portfolio currently, and some comments about the outlook going forward:

Asset Allocation


As you can see I don't own any technology stocks. This is probably typical with many dividend growth portfolios, as tech companies tend to use earnings for R&D and growth rather than return them to shareholders. I am completely comfortable with my 28% weighting in financial services; in fact I could see that go as high as 50% if situations presented themselves.
This portfolio is currently yielding 3.7% and is 68% invested in Canadian stocks. 19% of the portfolio is in a Dividend Reinvestment Program.

I am currently sitting on about 4% cash as you can see from the pie chart above. One stock that I am watching closely right now is Bank of America (BAC), which sports a fat 5.5% yield, and trades at a P/E of 10.9. Several U.S. stocks are beginning to look attractive since the Canadian dollar closed at around $1.04 today. Home Depot is another stock that looks interesting. It is trading around a multi-year low, and sentiment regarding housing may be bottoming. HD's earnings have been coming down as of late, however the fundamentals for the company still look very strong. That being said, I may already be exposed a little heavy to the U.S. consumer holding Walgreen and Scotts Miracle Gro. I do feel a bias toward the U.S. right now since our dollar has appreciated so far so fast, as well U.S. stocks are showing more value than CDN....it feels like an opportunity to use the $CAD buying power.

In Canada, nothing is really getting me too excited lately. Reitmans (RET.A) is probably the name that I have the most of my attention on. Bank of Nova Scotia (BNS) starts to look good whenever it wants to go below $50. I think BNS' next earnings report might give the stock a good bump, as I have a feeling Latin American earnings will come in very good, after seeing some numbers from U.S. companies like Whirlpool. Also BNS may look relatively unscathed in the subprime realm since they have smaller exposure than their peers.

Maternity-Leave Section
The Maternity - Leave section of the portfolio is about 83% complete. After some recent developments with my income, combined with recent looks at our budget, I may not bring the Mat. - Leave amount to 100%. Instead I may call the section complete and allocate funds elsewhere...I'm still debating that one.

6 comments:

FourPillars said...

Nice colours!

I'll be expecting the same for your rrsp as well as your entire portfolio!

Mike

White Eagle said...

Hi MG,

Have you considered adding any US ADR's to your portfolio to get some exposure to large European / international companies?

MG said...

4P - noted.

eagle,

Yes, I have. Are there any good dividend growers that you could suggest?

White Eagle said...

I'm keeping an eye on VE and DEO but the dividend isn't the key driver for me for these two as much as their markets. Nevertheless, the dividends are a nice bonus.

Dividend Tree said...

MG,

This is good diversification. I see real estate missing. Any reason why no real estate?

DT

MG said...

DT,
Real estate is my largest investment.

http://themoneygardener.blogspot.com/2007/12/why-no-reits.html