Portfolio Performance YTD - 5%

Written by The Dividend Guy on April 29, 2006

My portfolio YTD is up 5.2% according to Microsoft Money. Let’s look at this in comparison to the overall markets for their YTD numbers:

S&P/TSX (Canada): 8.3% FAIL
S&P 500: 5.0% PASS

Those darn resource stocks in Canada keep shooting the Canadian markets up, and my only true exposure is through Talisman Energy which has been doing well, but offset by a few of my other non-resource based companies.

My ultimate goal is to beat both of the indices - because if I can’t on a consistent basis than I am just blowing money in buy/sell commissions and therefore should just be buying index funds and holding on to them forever. So far, I am doing alright but I will need to pick it up a bit to ensure that I surpass both of them going forward. I hope that the sale of Merck and the purchase of additional shares in P&G will help.


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3 Comments so far

  1. Mike April 30, 2006 6:10 pm

    Hey, you got to get some (or a lot) of exposure to commodity stocks.

    It’s just my opinion, but trust me, you won’t get rich with dividend paying stocks. You need to surf the bubbles and get out before they pop.

    First it was tech and the next bubble is going to be commodities. But we’re still 5-10 years from the pop so you should get in and make some money.

    Think about how much faster your money will grow if you can get some quick 20%+ returns?

    I don’t think GE or Coke can move like that!

    But commodity stocks are right now. Get into some nice silver or uranium penny stock and you’ll be making money like you’ve never thought possible.

    Just my opinion but if you want to find out more about some possible speculations, check out my site!

  2. Geoff Gannon May 9, 2006 6:23 pm

    I disagree with the previous comment. You don’t need to “surf the bubbles and get out before they pop”. For the kind of stocks you seem to be interested in (just going by the portfolio), the two most important questions you need to answer for each of the stocks is whether the price is cheap enough and whether there is room to deploy additional capital within the franchise (i.e., at very high rates of return). You might want to consider some smaller companies with similarly strong franchises (there are a few niche businesses that have returns on capital comparable to the blue chips), but even that isn’t strictly necessary.

    If you just put your money into the most undervalued stock from among the stable of great businesses you follow, you’ll do fine. For instance, at the time of the millenium bubble, Coke, GE, HD, McDonald’s etc. had some rather high prices. In fact, there was a point where if you were blindly putting money into Coke, you wouldn’t do well at all, despite the fact that it remains a great business. On the other hand, you now have a stock like HD, that looks more attractive than some other great businesses, because its relatively cheap AND it looks like it still has a lot of room for growth within the franchise.

  3. candour enterprises May 1, 2007 8:17 am

    The philosophy of buying stocks for dividends and yield holds true. It is not the ONLY approach, but it is an approach which if executed correctly can provide excellent returns.

    Unfortunately, this approach does not pay dividends (pun intended) when stocks are traded. The trick is to be patient, after all infinite patience bring immediate results (think Drucker coined that one!)… buying for dividends is best done when (and only when) the stock you are targeting is yielding its highest. This is not easy to pick so don’t try, instead just pick the market pull-backs and corrections when they happen and invariably your target stock will have fallen too, and the yield will be high. This way you obtain dividend income and capital appreciation with stocks that may otherwise be market laggards to a degree.

    A mate and I have a portfolio going with this approach. If you click on the view our portfolios section you’ll see where we bought last June and this March during the corrections. Also where we bought incorrectly (not patient enough) in January. You can see the difference in using patience!

    We should all forget about studying the stock market and become students of patience!

    Our blog is www.portfolio-tracker.blogspot.com

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