We have just received some cash in several of our TFSA accounts from the recent buyout of CML Healthcare. I would appreciate any ideas out there about what might be a good investment for this cash.
Yes the money was nice to see,,,even if it arrived a day late.
We had owned CML for several years...bought at different prices,,,but having CML get bought out at that nice premium was good.,,,,and the divs over the years was nice....
So I am looking for similar type investments....Stable businesses,,(in fact boring businesses are always good), that pay a reasonable diividend. Riets are one idea.....any others out here?
Answering based on your parameters: maybe some utilities stocks, ZUT or some of its holdings. ZUT yields 6.08 - 0.62 mer = 5.46% yield
My warnings however would be that ZUT (like REITs) will likely drop if interest rates rise. Also, some utilities have recently cut distributions so the rather high distribution yield on the sector ETF is an indication that some further distribution cuts are expected.
If buying this, I would not be counting on capital gains
I have considered Fortis and Emera.....they have pulled back recently.
A rise in interest rates will probably affect them as well as the reits.
Any other suggestions? Perhaps I should be asking what others on the board have recently purchased in their TFSA's. ( or even in other accounts)....and why they felt they were good investments.
I wouldn't mind getting some bonds or debentures for the tax free income......but rates today are so low,,,and if you can get a good yield on a debenture,,,you may have to accept a less than perfect rating.
Warp, what's your current objective with your investments? Are you looking for income or growth? Do you index? If you are looking for something that pays distributions, you should consider dividend ETFs such as ZDV. I have also noticed some of the pipeline stocks have pulled back a bit.
warp, I for one, would not be buying anything high yield right now.
Certainly not utilities that are strongly based on bond yields.
In fact, a low yield or no yield growth company might be the best place to look right now.
How about some other sector, such as infrastructure, consumer discretionary, pharma, or energy services.
Such as Stantec, Aecon, ESI, FTT, TCW, just to name a few.
But what is wrong with REITs? Regadless of interest rates, if REIT has sustainable dividends , it's not too bad if you are looking for income stream...
Other options, may be BBD.B or banks...
For the past several years, I have noticed that I can find a whole lot of things to buy in the US, but having trouble finding things to invest in, here in Canada. I dont want to buy US in the TFSA'a because of the withholding taxes, which will be lost forever.
I am thinking ob buying UK stocks, because there qwill be no taxes withheld on divs...but do not want to convert into any more $US , as we already have substantial $US holdings in cash account, and registered accounts.
We already have some ZDV , but am also considering just buying more, to make things simple. Still I would prefer to find individual stocks to buy here in Canada for the TFSA's.
I always consider that while gains in the TFSA are wondersull...losses in the TFSA's are doubly worse because losses cannot be used to offset capital gains in a cash account.
Perhaps a stable bank , like BNS might be another option.
For the past several years, I have noticed that I can find a whole lot of things to buy in the US, but having trouble finding things to invest in, here in Canada. I dont want to buy US in the TFSA'a because of the withholding taxes, which will be lost forever.
I've also been interested in ZDV for some time, but last time I looked there were some pretty high risk names (very high payouts) among its top holdings.
I replaced my CLC with DR.to (Medical Facilities Corp), since I wanted something that paid a similar div and to retain a portion of my portfolio in the medical sector.
I want to look into the higher ratios in more details but I think it gives a good over view.
I've also put in the 5 year dividend increase. Still meaning to add in the last increase so sorry it's a bit rough looking
For a TFSA, I would not buy dividend stocks or dividend-spewing ETFs - you lose the dividend tax credit.
TFSA, for me, is strictly for Canadian growth stocks (although there is a case to be made for keeping HISA or other interest-bearing creatures in there, too). HISA if you will use the TFSA for an emergency fund.
The problem with pure growth stocks in a TFSA is that you can't claim a capital loss and you can't top up the balance of any of those loses. Additionally, capital gains on growth stocks are also pretty tax friendly in non-registered accounts - compared to HISA's, bonds, REIT's, etc.
Agreed - I'm livin' that particular nightmare right now (LOL). But the dividend tax credit is significant (unlike the US withholding tax on dividends, which is tiny).
Remember Wendi1, TFSA withdrawals are not subject to income tested government programs. Yes, you lose the tax credit but there is still no tax and it doesn't count against any earned income
ZDV holds more energy stocks than other dividend ETFs, which makes it slightly riskier. That said, this product is diverse and has pretty decent MER. I'm terms of holdings, I would say that, aside from more dividend paying energy stocks, the holdings are pretty typical of what you see in other similar products.
Most dividend funds are heavy in financial stocks, and with that high single sector exposure I feel that the usual funds (like XDV) are the riskier ones
Perhaps TSFA's as the 'emergency fund', fixed income part of the portfolio (we hold corp strip bonds in them that would otherwise be taxed as interest income). The RRSP for the longer term steady growth etf's, stocks (and some more fixed income), and the Trading Acc for DRIP'd dividends and capital gains?
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