Can’t Bring Myself to Buy Anything
- 12 Comment
I am in a bit of a quandary right now. I currently have about $2800 (CDN) sitting in an RRSP (Tax deferred account that I am completely unmotivated to invest. There is just nothing that excites me enough right now to invest my cold hard cash into. Most of my current holdings are in the high portion of my buy range. Until I update the data on these companies (next month or so when year end data comes out) I don’t want to act on these.
There is nothing really wrong with sitting on some cash. It provides me with funds should a stock I have been watching take a nose dive for no other reason than investor overreaction. In fact, this time on the sidelines has provided me with some time to analyze my holdings and look at the industries I am invested in. I believe that there are some opportunities for me to adjust my portfolio (buy – not sell) to include a better cross-section of industries. Here is what I am thinking:
| Industry | Companies Held | Notes |
| Banking / Financial Services | Royal Bank, Citigroup, Bank of America, IGM Financial | Good coverage here |
| Entertainment / Media | No holdings | Look at Disney, Rogers, Shaw |
| Insurance | No holdings | Look at AIG, Sun Life, Manulife |
| Industrial / Business Services | General Electric | Look at 3M, SNC-Lavalin, FedEx |
| Health Care | Pfizer | Would like more coverage – look at Glaxo, Johnson & Johnson, Amgen |
| Retailing | Home Depot, Wal-Mart | Good here – may look at Walgreens |
| Consumer Products | Procter & Gamble, Coca-Cola | I like this sector – may look at Pepsi, Buffalo Wild Wings, Colgate-Palmolive, Whole Foods |
| Technology | None | I need some exposure here – look at Intel, Motorola, Microsoft |
| Telecom | None | I need some exposure here (can be real good yields) – look at Verizon, AT&T, Telus |
| Energy | Talisman Energy, Epcor | Comfortable here |
As you can see, there are some holes I need to fill in this portfolio in order to spread some risk around to other industries. That will be my focus in finding new companies to invest in. Off to do some research…
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12 Comments on this post
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Tyler said:
Hey,
I really enjoy your blog because you have roughly the same philosophy as me.
Have you thought about exposure in international (Non-north american) dividend payers?
I prefer the International Dividend ETF symbol PID, but you could easily find individual companies that fit your style in other countries.
Domestically, looking at your notes, I would prefer Telus because it is a strong company with growth potential and it gives you exposure to the Telecom sector.
Just my $0.02.
Have a good day,
TylerJanuary 20th, 2007 at 1:10 pm -
Dom said:
Nice article.. I like how you structure your portfolio by industries and see the potential companies as puzzle pieces to fill in the whole picture. For insurance, I suggest that you take a look at ING Canada (IIC.to), a P&C insurance company with leading market share, superior ROE and combined ratios vs. competitors. At $52, it trades at around 9.5x P/E, 2.1x P/B, and 1.9% yield, although earnings seem to have peaked in the cylical P&C insurance market. Not many analysts cover it, so it may be a hidden gem.
January 20th, 2007 at 1:36 pm -
Cdntrader said:
was having the same thoughts as you for
international exposure. If you buy companies like Mcdonalds, or Kellogs you get multinational companies without leaving N.A. markets.But there is always the currency risk too.January 20th, 2007 at 6:28 pm -
Smarty said:
I’m still holding on to Pfizer. The last drop provided a very good opportunity to buy or add. I think J&J and Amgen are good candidates. For tech, I would have suggested Cisco three months ago. You can stay on the side line and wait until an opportunity arises.
Could you update my URL on your links.
Thanks,
Smarty
http://www.growingmoneyblog.comJanuary 21st, 2007 at 10:42 am -
Tyler said:
Cdntrader,
It is funny that you mention currency risk. I think that it is often overlooked by many investors (myself included). I will be publishing a short article on this topic at my site on Monday.
I agree with your philosophy on large multinational companies. The big Canadian banks are also working on their international exposure.
I like Scotiabank’s progress in latin america and BMO’s little move into China for the long term.January 21st, 2007 at 11:16 am -
Canadian Capitalist said:
There is a risk that you might end up with too many names. You already have at least 12 stocks to keep up with. Part of the reason that I am moving to an indexed portfolio is that I just don’t have the time to keep track to more than 5 names anymore.
January 21st, 2007 at 10:38 pm -
Tim said:
My first choice for long term dividend payout and growth would be Canadian Oil Sands Trust. Especially if I was in Canada. It is a bit of a pain to buy here in the states.
Tanker stocks: NAT, VLCCF, FRO. Dividends fluctuate wildly, but when they make money so do you.
January 22nd, 2007 at 10:59 am -
Cdntrader said:
Have to learn more about ETF’s myself, maybe a alternative for that international exposure without resorting to mutual funds.
Im also looking at canadian oilsands for a small position. It is coming down to a good entry point, and from what I have read,it does have a 30+ year reserve life. Still have some reading to do.
January 23rd, 2007 at 9:45 am -
The Dividend Guy said:
Thanks everyone for the comments.
Currency risk is something that absolutely needs to be considered. If things go the wrong way then that could wipe out any gain an investor may have seen in a stock.
As Canadian Capitalist mentioned, having too many names can be a problem. Adding some index exposure is an option that I am always looking at. I am fine right now from a time perspective, but as my kids get older that may need to change.
Thanks again everyone.
TDG
January 23rd, 2007 at 5:16 pm -
Everyday Investor said:
Hello TDG
Great blog. I’m in a similar situation, have a bit of cash sitting around. Everything seems a bit expensive right now.
MFC looks good to me. It’s not cheap, but taking a long term approach, I’m thinking that timing my purchases now would make a very small difference over the long term.
January 23rd, 2007 at 10:53 pm -
Middle Class Millionaire said:
We seem to be in the same predicament. I’m also sitting on a bunch of cash with nowhere to put it. Value seems to be a hard thing to come by these days. Although, I’ve recently taken a small position in MMM. I agree that there is some currency risk out there but I believe that MMM has a natural hedge against the US dollar due to their international exposure (60% of revenues outside of the US). If your interested I’ve posted a few items about diversification and currency on my blog.
P.S – I really enjoy your blog and have added it to my list of 4 blogs that I link to.
Cheers,
MCM
http://middleclassmillionaire.blogspot.com/February 7th, 2007 at 8:18 am
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