Investing, Economics MostlyOn by
Question: Are you experiencing a set income element as well to ‘cushioning’ equity accidents? Question: How did you fare in the 2008-9 crash when more than half of companies paying dividends either reduced them or cut them completely? I know things retrieved but how do you fare if the recovery had been very slow?
I’m requesting because I’m not sure whether to get using total come back and all cover equities or dividend stocks and shares only in pension as I don’t have any pension except CCP & OAS. Answer: I have already been intensely into dividends since the early 1980’s and I have never really had a 12 months of dividend income drop.
Dividend increases slowdown in keep markets, however, not right away. When there is a carry market, my overall dividend raises at a lower rate. This is because at such times, some ongoing companies stop dividend raises and some slice or cancel dividends. However, there are some that continue to increase their dividends always.
For example, my dividends increased in 2008, 2009, and 2010 were 11%, 15%, and 5.3%, respectively. Question: It must be that you have a large capital cushion such that you could live off your capital for your daily life duration and don’t need to live from dividend income. That cannot work for me or other people who haven’t any pension yet not enough cost savings to whether a black swan event. Answer: I’ve had specific companies cut dividends, like TransAlta and companies discontinue dividends, like Bombardier and companies like Sun Life and the banks stop dividend raises.
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It is just the entire dividend income has not decreased. I’ve a variety of dividend shares, some give low dividends but increase them well like Saputo (but these dividend increases have slowed) and REITs which give good dividends but increase at the rate of inflation yet others in between.
Question: There is certainly a risk of decreasing dividends and even companies suspending dividends given a dark swan event which we in Canada never have seen since 1929. How will you plan to deal with that possible event? Answer: I am of course gambling that there will never be an event in Canada in the foreseeable future that will demolish my dividend income to such an extent that I cannot live off my dividends. Question: Just how many companies do you are feeling is ideal for a stock portfolio that may give good diversification yet easy to manage such a portfolio?
Answer: I have 32 stocks in my own Trading Account, which gives most of my income. However, of these I have little committed to a few stocks. For example, I purchased Barrick Gold Corp for fun since it crashed. I also like tech shares and have small investments in TECSYS and Evertz Technologies since it is fun. So I really just have 29 stocks I am serious about getting dividends from.
Question: How many companies per sector do you think is the optimum? Answer: I must admit I made the majority of my dividends in Utilities and Bank or investment company. However, I have branched out into other financials, industrials, and REITs. I have focused on development dividend stocks than different sector shares rather. However, I have kept an eye on what sectors I have investments in to ensure I’ve some balance. Question: Since many companies today are actually international rather than domestic is it really necessary to add US dividend companies? Answer: I have gone into Canadian companies doing business worldwide rather than into the US or European market.
I attempted American and European companies before but did not make much profit them. There were also the problem of the forex rate and getting financial information. I just have one international company still left which is Barclays Bank or investment company. I have probably damaged a variety of investment rules.