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The Evil Master Plan, Update and Tweak.

If might have read my previous post Evil Master Plan, where I plan to make a bunch of $$ on some penny stocks and reallocate the $ to more DGI stocks.

If not, let me break it down quickly.

In my TFSA, I’ve sold my 239 Shares of Boralex (BLX) to initiate a position in Far Resources (FAT) at $0.405/share. I had made a plan with the money I will (and already have!) generate from this investment.

The old plan went as follows:

  • Repurchase my 239 shares of Boralex (BLX)
  • Then distribute the profits as follows:
    • Sienna Senior Living (SIA): 50%
    • Dream Global REIT (DRG.UN): 30%
    • Saputo (SAP): 20%

The new plan is looking a little more like:

  • Repurchase my 239 shares of Boralex (BLX)
  • Then distribute the profits as follows:
    • Dream Global REIT (DRG.UN): 35%
    • Sienna Senior Living (SIA): 25%
    • Telus (T): 25%
    • ZCL Composites (ZCL): 15%

The reason is that I want to concentrate on significant DGI stocks in order to increase my yield. After all, this move into FAT aimed to boost my yearly dividends and help me reach my goal. The Saputo (SAP) position will be reinforced once the tax return kicks in.

How things are going so Far (<– see what I did there?)

Current price for FAT is at $0.91 which means I’m standing at 125% gain on my position.

I’m realistically expecting a 3-bagger, and hopefully even a 4-bagger.

The current price for BLX is at $23.37, which is slightly higher than when I sold.

At this point in time, if I were to sell my FAT position and allocate it as mentioned I would get (I’ll round out the numbers to make it easier to read):

  • Selling 13,520 FAT shares = $12,300
  • Buying:
    • 239 BLX shares = $5,600 cost = $143 annual dividends
    • 195 DRG.UN shares = $2,345 cost = $156 annual dividends
    • 35 T shares = $1,675 cost = $71 annual dividends
    • 91 SIA shares = $1,675 cost = $82 annual dividends
    • 91 ZCL shares = $1,000 cost = $43 annual dividends

Total increase in annual dividends with new plan

  • Current situation: $495
  • 3-bagger situation: $711
  • 4-bagger situation: $999 (*drools*)

Even more Tweaking

Only fools don’t change their minds. The biggest change in the plan happens in my RRSP with my IME position.

I’ve bought 11,200 shares of Imagin Medical (IME) at $0.19. This is going to be a slower play and represents a smaller overall position than FAT. Human trial have just begun and results are expected in the next 3-4 months. I’m inclined to hold this stock longer than a few months if I have too. It currently trades at $0.235, so I’m standing at 24% gain.

I didn’t sell anything to initiate this position so nothing to repurchase.

My old plan was as follows:

  • Metro Inc (MRU): 30%
  • Alimentation Couche-Tard (ATD.B): 40%
  • Rogers Sugar Corp (RSI): 30%

I’ve since then realized the massive brain fart I was having when writing this… it’s my RRSP! My goal this year within my RRSP is to increase diversification, particularly in US stocks.

I came up with a loose idea of what amounts $ I would like to inject (medium to long-term) into some core US positions:

  • New Residential (NRZ) : $7,000
  • Armanino Foods (AMNF) : $5,000
  • Pfizer (PFE) : $5,000
  • Apple (AAPL) : $5,000
  • Unilever (UL) : $10,000
  • Proctor & Gamble (PG) : $15,000

Obviously I will need a lot more than a year to complete these positions, but might as well get them started with my IME profits down the line.

So here’s the new plan for my RRSP/IME position:

  • 50% New Residential (NRZ)
  • 50% Armanino Foods (AMNF)

The reason for selecting these two is their attractive yields and the fact that in my opinion, AMNF represents a very interesting value play as well.

Total increase in annual dividends with new plan

  • 2-bagger situation: $305
  • 3-bagger situation: $457
  • 4-bagger situation: $610

Let’s dream a bit

(As if I haven’t been doing that already…)

63433-Ima-Dreamer

Let’s say everything magically falls into place with 4-baggers occurring in both situations. This would mean an additional $1,609 in forward annual dividends, without having to contribute a single penny to my portfolios. What a sight. What about 5-baggers!??! Let’s not get too crazy now…

Let me know if you would do anything differently!

Am I over-planning?

-DI

 

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Dividend Investor View All

Money Lover, Dividend Growth Investor, Youtuber, and Blogger!

12 thoughts on “The Evil Master Plan, Update and Tweak. Leave a comment

  1. Hi,

    I enjoy reading your blogs and watching your YT-vids.
    I also like your strategy: buying penny-stocks and use the returns to buy new. preferably DGI, stocks.
    But I have some serious doubts about the stocks you would like to pick. Especially the ones for your RRSP.
    Would you care to elaborate these choices?
    A REIT with more than 10% dividend is a red flag for me.
    And T….that’s Telus on the TSX, right? imho better than AT&T.

    Liked by 1 person

    • Yes, T is in fact Telus for the TSX (can be misleading sometimes). Also it’s a good reflex to be cautious of such a high yield. However, I feel the EPS and revenue trends are favourable with room to keep growing the dividend. The yield in itself is of little interest to me and will vary according to share price. But yes, it is a REIT with a Beta of 0.94 so there is a risk inherently. A risk I am willing to take in this case. Thanks for reading! Cheers!

      Like

    • Unhappy… Hmmm… Well, I would always be happy with more. Probably impatient would be the right term to describe how I feel about my portfolio (and just my personality trait in general). I felt that part of my available capital could appreciate a tad faster. Can’t say I regret the move but I also can’t say I’d do it again. circumstances and market conditions were particular (Lithium is hot, etc).

      Like

  2. Hi Dividend Investor,
    I was impressed by your dividend picks on YouTube esp. FTN (split shares) which was a good high-yield idea.
    I have one question regarding FTN – is it a good idea to invest partly in common shares and partly in preferred to balance the risk if NAV falls or markets tank in future? This might compromise costs or deliver less returns but I feel it may help control risks. Your opinion on this?
    I’ve also taken some exposure to DS (Dividend Select) from Quadravest Funds. Its not a split-share but still provides good returns. Can you do a video or blog explaining Dividend Select 15 – how it works and how sustainable that yeild is and what are the potential risks? I would be keen to know your opinion and analysis on this one.
    Thanks for all the nice videos and valuable information. Happy New Year!

    Liked by 1 person

    • Thanks for reading and commenting! Yes, owning the two shares would decrease the risks and like you said, the returns. It all depends on your risk tolerance really. Also, I wasn’t familiar with DS but have briefly looked into it and it’s run sort of like a mutual fund with a 0.75% fee. They give a roughly 10% dividend based on the stock price. So instead of fixing a price, they pay according to price fluctuations, this means you have a constant yield, but variable dividend. It also means, if the price drops, your dividends drop. The opposite is also true. This (to me anyways) is an unusual format, but an interesting one. You can never really “buy the dip” from a long term DGI standpoint because everyone always gets the same YoC. I have a tendency to think that this would protect the dividend if the price of DS drops and thus lowers the risk of them lowering their target yield. But honestly, I’m not familiar at all with this format. Cheers!

      Like

  3. I have been lurking the YouTube channel for a while now and I am on board with the Evil Plan. My goal is to follow in your footsteps (even though I’m older) and start a channel/blog. But for now I love the approach, I consider my trading more hobbyish, but I have to do it to help me maintain focus on the long term growth! Keep up the great writing and recording!

    Liked by 1 person

  4. Just a question : why are you so interested in Boralex (BLX) other than for the dividend? Could you mention your take about Boralex sometime?

    Like

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