August 2016 Investment Report

Laurier House

Laurier House in Ottawa where my uncle worked with Prime Minister Mackenzie King

Family History Mixed With Canadian History

August was a month to travel to Ontario with the grandkids. I took the opportunity to visit Laurier House in Ottawa to explore my heritage.  My Uncle Deane Russell worked for Prime Minister Mackenzie King from 1939 to 1945.  My uncle wrote a memoir of his time with the PM and I was able to get the Alberta Historical Society to agree to publish it  – coming out later this year.  I created a family version which you can see by clicking the picture above.

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August Results

The markets were pretty flat this month with a fractional gain or loss, leaving the YTD relatively untouched from last month.My Canadian stocks grew slightly more than the TSX, but my US fell by over 1% for the month.  My YTD gains are still 10% to 12%, depending on the measurement, making 2016 a pretty good year as long as there are no big drops in the last four months.  Helped by a strengthening US dollar my overall portfolio (in Canadian dollars) grew by 0.36% (10.21% for the year).

Aug YTD
TSX 0.10% 12.21%
DJIA -0.17% 5.60%
S&P -0.12% 6.21%
BB CDN 0.99% 12.58%
BB US -1.36% 12.66%
BB Total (no FX) 0.25% 12.32%
BB Total (incl FX) 0.36% 10.21%

 

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Regular reader David, provided this link to a mobile app for investments that he finds useful.  It appears it is an Apple only app, so those with IPhone and IPad can give it a try.

https://itunes.apple.com/us/app/stock-master-real-time-stocks/id591644846?mt=8

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Buy on Fact, Sell on Rumour

If you have read the comments section, you will see I received a question about POT.  Just at the end of the month there was a rumoured merger between AGU and POT, Canada’s big two potash producers.  The potash industry has been depressed for the past year or so on low world prices.  That prompted POT to cut its dividend twice, removing it from my suggested list and putting it on my “sell” list.  I was just looking for the right time to sell my position in POT.

The rumoured merger caused both stocks to rise considerably in one day (8% for AGU and 12% for POT).  Using the above adage, I sold my positions in both.

The merger may or may not take place, and it could result in further increases in share values, but, as I note in the comments, A Bird in the Hand…

I have always made a habit of selling on a big jump based on a market rumour.  It may cost me some future gains, but it does allow me to bank the unexpected profits and protect against a pullback if the rumour turns out to be bad.

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More on Housing

Knowing my feelings about real estate as an “investment”, several people sent me a link to this article – interesting reading.

http://www.cbc.ca/news/business/house-investment-wealth-1.3716641

HERE is a handy Rent vs Buy flowchart

http://www.businessinsider.com/buy-or-rent-a-home-flowchart-2016-7

HERE is an intelligent discussion of rent vs buy with a spreadsheet to calculate the difference.

http://wheredoesallmymoneygo.com/rent-versus-buy-calculator/

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Suggested Stocks

US

Company Ticker Financial Strength Dividend Yield Dividend Growth 10-Year Current PE Ratio
3M Company MMM A++ 2.47 8.5 21.51
AT&T Inc. T A++ 4.72 3.5 14.31
Automatic Data Proc. ADP A++ 2.53 13 25.5
Boeing BA A++ 3.46 12.5 14.55
Bristol-Myers Squibb BMY A++ 2.59 2.5 23.13
Cardinal Health CAH A++ 2.34 26 18.08
Chevron Corp. CVX A++ 4.2 10 73.3
Coca-Cola KO A++ 3.3 9.5 22.17
Colgate-Palmolive CL A++ 2.09 11 26.19
Deere & Co. DE A++ 2.75 15.5 23.66
Dover Corp. DOV A++ 2.39 9.5 21.61
Du Pont DD A++ 2.31 2.5 20.78
Emerson Electric EMR A++ 3.51 8 17.01
Exxon Mobil Corp. XOM A++ 3.45 9.5 31.57
Franklin Resources BEN A++ 2.25 15.5 12.42
Grainger (W.W.) GWW A++ 2.11 17.5 19.47
Home Depot HD A++ 2.04 19.5 21.16
Honeywell Int’l HON A++ 2.04 9.5 17.2
Illinois Tool Works ITW A++ 2.18 12 21.1
Infosys Ltd. ADR INFY A++ 2.62 17.5 15.29
Int’l Business Mach. IBM A++ 3.56 20 12.94
Intel Corp. INTC A++ 2.96 17.5 14.26
Johnson & Johnson JNJ A++ 2.78 9.5 19.57
Kimberly-Clark KMB A++ 2.87 8 23.35
Lilly (Eli) LLY A++ 2.62 3.5 21.61
Lockheed Martin LMT A++ 2.78 20.5 20.06
McDonald’s Corp. MCD A++ 3.19 20 20.25
Medtronic plc MDT A++ 2.01 15 15.53
Merck & Co. MRK A++ 2.95 1.5 16.89
Microsoft Corp. MSFT A++ 2.63 19 20.2
Novartis AG ADR NVS A++ 3.47 13 20.88
Novo Nordisk ADR NVO A++ 2.35 26.5 18.89
PepsiCo, Inc. PEP A++ 2.8 11.5 22.2
Pfizer, Inc. PFE A++ 3.45 4.5 19.21
Procter & Gamble PG A++ 3.05 10 23.32
Public Serv. Enterprise PEG A++ 3.86 3 16.63
Qualcomm Inc. QCOM A++ 3.38 22.5 13.53
Raytheon Co. RTN A++ 2.07 11.5 16.98
Schlumberger Ltd. SLB A++ 2.46 15.5 73.95
Smucker (J.M.) SJM A++ 2.13 9.5 21.69
Texas Instruments TXN A++ 2.18 29.5 22.82
Total ADR TOT A++ 5.75 5.5 12.38
Travelers Cos. TRV A++ 2.28 8 12.18
Unilever PLC ADR UL A++ 3.12 6.5 23.4
Union Pacific UNP A++ 2.31 21 18.32
United Technologies UTX A++ 2.45 12.5 16.05
Verizon Communic. VZ A++ 4.28 3 13.46
Wal-Mart Stores WMT A++ 2.81 14.5 17.12

Canada

Company Ticker Domicile Code Financial Strength Dividend Yield Dividend Growth 10-Year Current PE Ratio
Agrium, Inc. AGU CA A 4.15 39 15.42
Bank of Montreal BMO.TO CA B++ 4.06 7 12.76
Bank of Nova Scotia BNS.TO CA A 4.36 9 11.54
BCE Inc. BCE CA B++ 4.28 8.5 19
Cameco Corp. CCO.TO CA B+ 3.28 14 17.4
Can. Imperial Bank CM.TO CA A+ 4.69 6.5 10.85
Can. Natural Res. CNQ.TO CA B++ 2.27 23.5
Empire Company Ltd. EMP/A.TO CA B++ 2.08 10 11.46
Enbridge Inc. ENB.TO CA B++ 4.1 12.5 21.48
Finning Int’l FTT.TO CA B+ 3.11 13 25.79
Fortis Inc. FTS.TO CA B+ 3.51 9 19.1
Jean Coutu Group PJC/A.TO CA B++ 2.46 13 16.38
Magna Int’l ‘A’ MGA CA A 2.49 7.5 7.76
Manulife Fin’l MFC CA B++ 4.17 3.5 9.7
Methanex Corp. MEOH CA B+ 3.86 12
Nat’l Bank of Canada NA.TO CA B++ 4.86 10.5 10.21
Pembina Pipeline Corp. PPL.TO CA B++ 4.86 5 33.75
Potash Corp. POT CA B++ 2.43 37 26.16
Power Financial PWF.TO CA B+ 5.32 7 9.44
Rogers Communications RCIB.TO CA B+ 3.39 51.5 19.35
Royal Bank of Canada RY.TO CA A 4.2 10.5 12
Russel Metals RUS.TO CA B++ 7.03 10 19.31
Shaw Commun. ‘B’ SJRB.TO CA B+ 4.53 28.5 19.48
Suncor Energy SU.TO CA A 3.2 24
TELUS Corporation T.TO CA B++ 4.45 15.5 16.86
Thomson Reuters TRI.TO CA B++ 2.53 5.5 25.37
Toronto-Dominion TD.TO CA B++ 3.97 10.5 12.26
TransCanada Corp. TRP CA B++ 4.84 5.5 27.3

Europe

Company Ticker Domicile Code Financial Strength Dividend Yield Dividend Growth 10-Year Current PE Ratio
Novartis AG ADR NVS CH A++ 3.47 13 20.88
Daimler AG DDAIF DE B++ 5.34 5 7.04
Siemens AG (ADS) SIEGY DE A 3.16 11 13.4
Novo Nordisk ADR NVO DK A++ 2.35 26.5 18.89
Total ADR TOT FR A++ 5.75 5.5 12.38
AstraZeneca PLC (ADS) AZN GB B++ 4.21 12 22.3
Brit. Amer Tobac. ADR BTI GB B++ 3.34 14 20.52
BT Group ADR BT GB B++ 4.2 0.5 11.91
GlaxoSmithKline ADR GSK GB A+ 5.03 6 27.68
Rio Tinto plc RIO GB A 3.46 11 12.73
Vodafone Group ADR VOD GB B++ 5.63 14 36.59
WPP PLC ADR WPPGY GB A+ 2.66 17 18.78
Luxottica Group ADR LUX IT B+ 2.04 12 23.34
Tenaris S.A. ADS TS LU B+ 3.19 10 57.67
Philips Electronics NV PHG NL B+ 3.24 8.5 43.97
Unilever PLC ADR UL NL A++ 3.12 6.5 23.4

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Happy Investing!!

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About borgford

Feel free to contact me with questions: brianborgford@hotmail.com
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