Tag Archives: Distributions

Boston Pizza Fund

29 Jul

Over the years, I’ve traded a lot of stocks.  Even though, I took some pretty bad losses, I always seem to offset them with my gainers. There is one unit trust that I have kept for the longest time.  BPF.UN has given me a steady monthly distribution and share price appreciation.

Early 2009 was a pretty bad year for stocks.  At that time, I was pretty cash strapped.  I didn’t have a whole lot of money laying around to invest in.  But I wanted to put some money into a stock that will pay itself off.

On May 2009, I decided to put down 200 @ $9.10 on BPF.UN.  At that time, they were paying out 11.5 cents per share monthly!  So for a while, I was receiving $23/month… the distribution was lowered due to some rule changes to unit trusts in Canada.

Commission fee:  $29 (BMO Investorline)
Total dividends collected to date: $1026 (+55.48%)
Unrealized capital gain: $2601 as of July 29, 2013 (+140.67%)

Not bad for a relatively small market sized eatery on the West Coast of Canada.  I have more than doubled my money here.  If I only invested more, I would have been much better off now.

PS.  Scotia Itrade is charging me a quarterly inactivity fee of $25.  The only two stocks I hold there are BPF.UN and 300 shares of CHE.UN.  The combined total is less than the $10,000 minimum requirement .  So I might have to sell my beloved BPF.UN and move the money  to Virtual Brokers.  Itrade commission fee per trade is $24.99, really high if I wanted to stay put with them!! 

 

Ultimate Goal

4 Jul

Hypothetically speaking, can one build a stock portfolio that is sustainable to churn out $20,000 per year in distribution/dividends to stop working and live off the dividends from your stocks?

I’ve been leisurely reading Derek Foster’s “Stop Working, Here’s How You Can!”  At the end of his book, he constructed a sample stock  portfolio where he collects $18,845 per year in distribution/dividends deprived from his original investment cost of $103,500.

Can I replicate his method in this day and age?

Let’s say I just invested the whole $103,500 into one of my high yielding stocks in today’s stock prices:

BPF.UN– $103,500/17.47= 5924 shares @ 1.20= $7108.80/yr
BMO– $103,500/57.77= 1791 shares @ 2.80= $5014.80/yr
KEG.UN– $103,500/14.04= 7372 shares @ 0.96= $7077.12/yr
IPL.UN– $103,500/19.27= 5371 shares @ 1.08= $5800.68/yr
CHE.UN– $103,500/15.85= 6530 shares @ 1.20= $7836.00/yr

Even if I did find a cheaper stock like PGF which is yielding about 12.79% at the moment.  I still wouldn’t be able to make it to my $18,845/yr goal:

PGF– $103,500/6.57= 15753 shares @ 0.84= $13232.52/yr

This just means I have to construct at least a $250K plus portfolio to realistically support the $20k per year in distributions/dividends.  That is a big feat to accomplish.  Currently, I am collecting around $275 per month.  I have a long ways to go before I hit my ultimate goal of working as a sole investor/trader.

Alternatively, trading stocks is more lucrative if you know how to time your trades to the tee.  One can easily reap the rewards faster with the daily swings of the market…

I’ve been inactive for the past month.  It’s time for me to shake off the bad trades in May and start anew!