# Any IDEAS for TFSA stock buys?



## warp (Sep 4, 2010)

We have cash sitting in our TFSA accounts and will have more cash come Sept when CML gets bought out, ( or sooner if I decide to sell our shares now).

What are you buying in your TFSA? 

What would any of you suggest as a reasonable , long term stock, or stocks, to purchase in a TFSA?
Please take a moment to explain your reasoning. 
I prefer dividend paying stocks, myself.

I am thinking of adding to Interpipe, or Pembina, but we already hold these.

Thanks to all for any posts/ideas.


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## Cal (Jun 17, 2009)

The rest of your portfolio holdings would help in making recommendations....assuming you are interested in a balanced approach.


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## Jon_Snow (May 20, 2009)

With thier recent slide, REITS are on sale - with nice yields to be had with Artis, Riocan etc.... I loaded up on these in recent weeks.


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## Echo (Apr 1, 2011)

Canadian Oil Sands (COS) is worth a look - http://www.theglobeandmail.com/glob...ks/summary/?q=COS-T#dashboard/follows/Authors


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## warp (Sep 4, 2010)

Jon_Snow said:


> With thier recent slide, REITS are on sale - with nice yields to be had with Artis, Riocan etc.... I loaded up on these in recent weeks.



Thanks for the suggestion. I prefer to buy Reits outside of our TFSA accounts. 
In fact I bought some Chartwell this morning, and am thinking of Northwest Healthcare reit, but outside of our TFSA's.

I have been thinking of Can Oil Sands.....thanks for the thought.....and perhaps some Encana, now that its down.

One problem with the TFSA accounts is that you should buy only Canadian stocks, because any foreign tax withholding on divs will be lost forever in the TFSA.

All suggestions and thoughts are appreciated.


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## Synergy (Mar 18, 2013)

warp said:


> Thanks for the suggestion. I prefer to buy Reits outside of our TFSA accounts.


Just curious, why no REITS inside your TFSA? I've always thought that TFSA's are a perfect place for REITS as they often include return on capital within their distributions, which can be a pain to keep track of within a non-registered account.

Crescent Point (CPG) or Baytex (BTE) or two other energy plays with good yields.


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## none (Jan 15, 2013)

Synergy said:


> Just curious, why no REITS inside your TFSA? I've always thought that TFSA's are a perfect place for REITS as they often include return on capital within their distributions, which can be a pain to keep track of within a non-registered account.
> 
> Crescent Point (CPG) or Baytex (BTE) or two other energy plays with good yields.


Correct, as long as it's a Canadian REIT you are good to go for a TFSA.


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## humble_pie (Jun 7, 2009)

buy sound decent stock with decent dividends plus decent options, then juice it up with option sales. Dmoney style.

alas one cannot sell puts inside a registered account but there's always the Left Turn, a put strategy perfected by cmf member lephturn.

all in all one's current return should approach 7-10%, not taking into account what happens to price of the underlying stock. ie this return does leave reits in the dust ...


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## My Own Advisor (Sep 24, 2012)

@warp,

Same, some money, not much coming my way when CLC deal goes through. My short-list for the TFSA money is the following:

COS
BTE
NA
Canadian REITs like CWT.UN, D.UN
T (Telus)
BDT
FCR

Not sure what I'll chose yet...nice to have decisions like these though. Holding CLC paid off, at least for now.


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## humble_pie (Jun 7, 2009)

here is just one conservative possibility, but there are many others going begging these days:

- buy 200 TRP at 46.44 CAD. This underlying has lost ground but long-term i'm of the camp that believes Obama will approve the keystone. I believe that pipelines will win out over railcars. In particular, i believe that the fringe proposal to build a new northern railway over the canadian tundra, through the yukon to alaskan ports, is lunacy.

- sell 2 jan 2014 50 calls at .95.

- sell 2 jan 2014 42 puts at 1.05. These have to be sold outside the tfsa, so use lephturn's Left Turn put strategy.

- total options = 2.00, therefore cash cost of this position is 44.44.

the current 6-month return from dividends (2 dividends within the 6-month time frame) plus option sales is 6.57%. One might roughly estimate an annual return of 10-12%, assuming one would repeat the option strategy in december/13 or january/14.

EDIT: assignment of the calls would push the 6-month return north of 19%, but generally speaking a long holder of the stock would not want exercise to occur, since TRP as a base holding plus short option strangles are going to function as a cash cow in the account.

keep in mind that, if stock price does rise to $50 or more, thus making exercise a possibility, the long holder of the stock will benefit on paper without having to pay capital gains taxes on the gains he would realize if the calls were exercised.


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## supperfly17 (Apr 18, 2012)

humble_pie said:


> here is just one conservative possibility, but there are many others going begging these days:
> 
> - buy 200 TRP at 46.44 CAD. This underlying has lost ground but long-term i'm of the camp that believes Obama will approve the keystone. I believe that pipelines will win out over railcars. In particular, i believe that the fringe proposal to build a new northern railway over the canadian tundra, through the yukon to alaskan ports, is lunacy.
> 
> ...


I think I have to do some more serious book reading.


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## jcgd (Oct 30, 2011)

I've been looking at Telus and Vale. But I'm not sure where to hold Vale. I believe it's an ADR.


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## warp (Sep 4, 2010)

Vale is supposedly ":cheap" right now, having fallen along with all the other commodity stocks. It is a Brazilian company, I believe, and it trades as an ADR, so make sure what tax % will be withheld from your dividend payment because if bought in a TFSA , these taxes will be gone forever.

Anyone else have any ideas of Canadian srocks, that would make good additions to a TFSA?


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## dime (Jun 20, 2013)

*Short term bond ETFs*



warp said:


> Anyone else have any ideas of Canadian srocks, that would make good additions to a TFSA?


IMHO perhaps the best way to take advantage of the TFSA tax free is to put short term bond ETFs in there rather than stocks.
Here's the reasons I did:

Tax advantages:
- To maximise your the tax advantages of the TFSA: Stocks and stock dividends have favourable capital gains tax outside the TSFA. But interest income is taxed fully as income outside the TFSA.

Safety:
- Everyone should have something invested in bonds to offset the volatility risk of stocks, and increasingly so as you age. Another 2009 market sell off of 45% could happen again at some point in the future.
- The bond fund provides diversification and some are designed just like a 0-5 year ladder.
- At this point in time, facing an future of rising rates, you want short term corporate bond fund. With an average duration of say 3 years they'll recover from changes in rates within a much shorter time period than longer term bonds. 
- It makes the TFSA into something like an emergency fund where you know the money is much more likely actually be there in the future when you need it.


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## My Own Advisor (Sep 24, 2012)

All good stuff, but I'd rather have my emergency fund in a savings account and my TFSA as another retirement growth account, that means bond-free.


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## humble_pie (Jun 7, 2009)

why so much enthusiasm for vale? it's a mining company - one of the world's biggest, maybe numero due after rio tinto - with a few troubles with the president of brazil one hears.

vale owns the former inco mines & smelters at sudbury & in newfoundland/labrador. These have witnessed prolonged strikes recently. Believe i've seen vague talk that vale might unbundle the canadian properties. Come back little sheba.

all in all i'd rather own teck or even inmet although they are not comparable.


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## warp (Sep 4, 2010)

My Own Advisor said:


> All good stuff, but I'd rather have my emergency fund in a savings account and my TFSA as another retirement growth account, that means bond-free.


With bond yields so low right now, and with the distinct possibility, that they will creep up into the fututre, ( causing the prices of these funds/etfs to fall), bond funds/etf's are not the place to be right now. Better to get your TFSA money into a HISA if you want it to be totally safe and collect interest.

I prefer to buy some stocks in our TFSA's at the moment......
the question is what any of you other posters would recommend. I always figured more heads discussing possible buys were better than one. Thanks.


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## james4beach (Nov 15, 2012)

I'm totally a fan of putting interest income things in the tax sheltered accounts... because as dime says, stocks have favourable tax treatment anyway. Bonds, GICs, and savings account income get heavily taxed though.

I suggest a mix of HISA and GICs instead of short term bonds.


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## rknigh2 (Jun 5, 2012)

ABX puts. BBRY covered calls under $9. AGU under $90. That's about it for Canadian companies for me.


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## rknigh2 (Jun 5, 2012)

I forgot CCJ and DNN have been on the radar, but would like to wait to buy in the fall. Also, DNN has some nice premiums on the jan 2014 $1 puts (non-tfsa).


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## leeder (Jan 28, 2012)

@ warp: Are you willing to invest in ETFs? You alluded in your original post that you are looking for stocks to invest, so I wasn't sure if you would want to invest in ETFs. Ultimately, it depends on your current investment portfolio in your other account, as well as your investment style. If you're looking for income, then I suggest the likes of ZDV or CDZ. If you have a lot of Canadian content in your other portfolios, maybe consider investing in US or international indices. There's also ZDY, which is the US version of ZDV trading in the TSX, if u are looking for income.

If you do insist on individual stocks, maybe some blue chips that may be beaten up recently, like Telus, Potash Corp, etc.


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## My Own Advisor (Sep 24, 2012)

Good call on T and POT leeder. Bought some T last earlier this month after Verizon news sent it down.

Bad news is good news for stock investors.


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## leeder (Jan 28, 2012)

@ My Own Advisor: No kidding! I bought some T when it was at around $29.70 earlier this month. I will continue to add to them and DCA if it keeps heading lower. I DCA'ed POT and picked some up today at around $37.90. High quality businesses for the long-term that are fairly cheap, imo.


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## warp (Sep 4, 2010)

leeder said:


> @ warp: Are you willing to invest in ETFs? You alluded in your original post that you are looking for stocks to invest, so I wasn't sure if you would want to invest in ETFs. Ultimately, it depends on your current investment portfolio in your other account, as well as your investment style. If you're looking for income, then I suggest the likes of ZDV or CDZ. If you have a lot of Canadian content in your other portfolios, maybe consider investing in US or international indices. There's also ZDY, which is the US version of ZDV trading in the TSX, if u are looking for income.
> 
> If you do insist on individual stocks, maybe some blue chips that may be beaten up recently, like Telus, Potash Corp, etc.


I/we hold several ETF's including ZDV at the moment.

One worry about TFSA accounts is that while profits are not taxable,. remember that losses cannot be used either.( against any losses in cash accounts).

For this reason, it is problematic to invest TFSA money in riskier assets.
We already own lots of Interpipe, Pembina, and Altagas. Also held CML Health...their recent buyout was nice...

I am thinking of picking up some BCE , and perhaps some Veresen...VSN..the latter for the nice yield.
Ant thoughts on these?


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## leeder (Jan 28, 2012)

warp said:


> I/we hold several ETF's including ZDV at the moment.
> 
> One worry about TFSA accounts is that while profits are not taxable,. remember that losses cannot be used either.( against any losses in cash accounts).
> 
> ...


Risk and return go hand in hand. If you are afraid that the equity market will go down and that you can't use capital loss to offset capital gains, then you are left with GICs or holding cash in HISA.

BCE is just as risky as many of the equities out there. Case in point, in April when interest rates were rising, the telecom stocks and many dividend paying stocks (including utilities and pipelines) were falling. Also, when news of Verizon's entry into Canada was all over the news, all the telecom stocks were affected to some degree.

Regarding VSN, if you say you hold ZDV, then you hold a good chunk of VSN already. If I remember correctly, VSN is a large holding within ZDV.

The reason I asked whether you would be interested investing in ETFs because you minimize individual stock risks when you are holding a basket of stocks. For example, if BCE does badly for a month, there may be other stocks within the ETF that may offset that loss.


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## TIP (Jul 16, 2013)

Are you only looking for stocks? will any other investment work as well. 
There are some investment available known as Mortgage Investment Corporations (MIC). They returns are fairly good (8% to 10%). Perfect for TFSA. MIC form of investments are on the rise, especially, since mortgages are very secure form of investment. There is a really good article in Summer issue of Money Sense. If you are interested let me know I'll find that article and gyou the info.


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## eiffel (Aug 1, 2013)

TIP said:


> Are you only looking for stocks? will any other investment work as well.
> There are some investment available known as Mortgage Investment Corporations (MIC). They returns are fairly good (8% to 10%). Perfect for TFSA. MIC form of investments are on the rise, especially, since mortgages are very secure form of investment. There is a really good article in Summer issue of Money Sense. If you are interested let me know I'll find that article and gyou the info.


How exactly do these MIC's work and how do you buy them ?


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## warp (Sep 4, 2010)

leeder said:


> Risk and return go hand in hand. If you are afraid that the equity market will go down and that you can't use capital loss to offset capital gains, then you are left with GICs or holding cash in HISA.
> 
> BCE is just as risky as many of the equities out there. Case in point, in April when interest rates were rising, the telecom stocks and many dividend paying stocks (including utilities and pipelines) were falling. Also, when news of Verizon's entry into Canada was all over the news, all the telecom stocks were affected to some degree.
> 
> ...


I have been meaning to reply....

ZDV ...( the BMO dividend ETF)...does hold Veresen...but it is only 2.85% of the etf's holdings...not a large holding as you suggest.

Thanks for the thoughts though.eeder.

Any other sugestions out there about what might be a good TFSA candidate?


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