August has been an investing month with an adjustment to my portfolio diversification. My stock selection strategy is the same and has not changed but my diversification tracking allows me to look at sectors out of favor. I do try to add to the sectors out of favor unless there is another holding with a major pull back.
At this point, 7 of my 31 holdings have a Chowder Rule under 10%. My target is to have a 12% based on the 10-year CAGR dividend growth. I am not religious about it but when I look at the sector and the competition, I do take it into consideration.
August saw some new money added to my portfolio and I also made some sector percentage adjustments.
When I looked at all the sectors, I had too much in income related sectors rather than growth sectors. When I added the real estate, utilities, and communication sectors, the overall percentage was too high compared to others and I reduced the total and increased the financial sector.
August 2017 Trades
- Reduced utility sector percentage by selling some Brookfield Infrastructure Partner TSE:BIP.UN.
- Increased financial sector percentage by adding more Toronto-Dominion TSE:TDNYSE:TD .
- Added to the financial sector by increasing my position in Visa .
- Added to the technology sector by increasing my position in Apple NASDAQ:AAPL.
- Added to the healthcare sector by increasing my position in Cardinal Health.
- Added to the consumer defensive sector by increasing my position in Kimberley-Clark .
- Added to the consumer defensive sector by increasing my position in SaputoTSE:SAP .
June 2017 Trades
- TD BankTSE:TDNYSE:TD saw more money added to the account making it my 6th largest holding.
- EnbridgeTSE:ENBNYSE:ENB saw some money added to top up the energy sector making it my 3rd largest holding.
- Kimberley-Clark also had an increase of fund making for the consumer defensive sector.
- Cardinal Health is a new addition to the healthcare sector.
Sector Diversification – August 2017
Here are my new sector diversification ratios. The biggest adjustment was the communication sector. While there is some growth, I consider the sector to primarily provide income akin to the utility sector. It’s an oligopoly with strong competition.
One key realization as my portfolio grows is that I do not want to have more than 5% of my portfolio in one holding. It leads me to have at least 20 stocks at a minimum but really there should be at least 1 stock per 5% bracket per sector. For example, I should have the following target at a minimum.
Sector Diversification – July 2017
My August dividend income is the low month of the quarter with $1,114.32. My portfolio continues to beat the Candian or US index and when I compare with a blended index portfolio, it’s doing even better. With clear portfolio performance data tracked since 2009, I now have 8 years of data highlighting my dividend growth investing strategy works. I am waiting for a market pull back to see how my portfolio will do.
DISCLOSURE: Please note that I may have a position in one or many of the holdings listed. For a complete list of my holdings, please see my Dividend Portfolio.
Join 6,000+ Investors & Build a Winning Portfolio