The 50K Report - 2016 Ends. (Q4 FY2016)

Q4 FY2016 (October, November, and December)
Next update: End of Q1FY2017 (January, February, and March)

Investment Goals:

1. Continue adding to higher quality large cap equities.
2. Continue slimming down number of holdings within portfolio.
3. Continue seeking opportunities to broaden portfolio by sector.
4. Focus on stocks that have a DRIP plan.
5. Continue concentrating existing holdings to achieve $1,000 dividend mark (1K Club)
6. $50,000 passive income target. (eg. $1,000,000 at 5% will yield $50,000 per year.)

Developments:

- Calculation of Total Book Value Required: $50,000 / % yield = Book Value (eg. 4.31% = $1,160,092.81)

- Current Target Book Value @ 4.6878%: $1,083,805.9564

- Further stratification of income Goal Posts.

- Ontario Minimum Wage Increase reflected: $11.40.
- Achieved new updated Minimum Wage Goal Post: $17,748

- Record Distribution income $18,891.95

- Reorganised data to breakdown by account type: Non-Registered, RRSP, TFSA, and DPSP (Employer).

- Included Margin Debt. Margin debt was used sporadically over the course of the year to practice for use as a potential long term tool. The intention is to use this in lieu of DRIP; to take advantage of Tax Deduction; and leverage my growing portfolio with manageable debt.

- Goal to become more fluid and not be too attached to my current yield to cost.

- Markets have risen significantly post-November US Election and the US Fed raising their interest rates.

- Got this report out on time.

Distribution Changes:

- Distribution income increased from Q3FY2016's $15,334.55 to $18,891.95. (+$3,557.40 or +23.1985%)
- Doubled BCE Inc adding it to the 1K Club; added more BCE Inc Preferred Shares Series H; added 96 more shares of Scotia Bank to round out position; added more Enbridge Preferred Share Series R, Inter Pipeline Ltd, Telus Corp, Diversified Royalty Corp, iShares TSX Preferred Shares ETF, and TransCanada Corp.

- Distribution increase for Inter Pipeline Ltd, Telus Corp, Allied Properties REIT, and Interrent REIT

- Added CI Financial Corp, Bank of Montreal, Toronto Dominion Bank, and Bristol Myers Squibb Co (BMY).

- BMY was a Put Assignment.

- Included an existing position, StorageVault Canada Inc, but it has an insignificant yield of 1.0862%

- Reduced Manulife Financial.

- Removed Bank of America and Imvescor Restaurant Group Inc.
- Stratification of Goal Posts to emulate increased hours of work.

Progress for Q4 FY2016. (Values represent potential full year cash flow):

Book Value	$409,504.09
Yearly Distribution	$18,891.95
Yield Total	4.61%
Margin Debt	-$38,571.58
Margin Interest	3.45%

Goal Posts:

- Increased stratification to 6 Goal Posts.

- First 3 Goals are related to:

• Minimum Wage of $11.40
• Hours of work per week: 30, 37.5, and 40.
• 37.5 hours reflects my current weekly work hours.

- Final 3 Goals are check points for achieving the mid-30 and 40 thousand dollar range.

Dividend Goal	% Completion	Remaining
$50,000	37.89%	$31,108.05
$45,000	41.98%	$26,108.05
$35,000	53.98%	$16,108.05
$23,712	79.67%	$4,820.05
$22,230	84.98%	$3,338.05
$17,784	106.23%	-$1,107.95

Holdings (Monthly Change):

October

Book Value: $318,837.7550

Yearly Dividend: $15,110.4405

Yield Total: 4.7392%

November

Book Value: $349,770.4735

Yearly Dividend: $16,655.5133

Yield Total: 4.7618%

December

Book Value: $409,504.0898

Yearly Dividend: $18,891.9468

Yield Total: 4.6133%

Upcoming:

• Adding new metrics:
  • I've added to my individual stock investment spreadsheets the total distributions gained over time.
  • Whilst writing up this 50K report thought of how and which metrics would be relevant to provide a snapshot of distribution returns in comparison to the investment.
  • Working on little kinks in the presentation of information:
    • If I sold a portion at a loss the % return from distributions will become larger starting at that period.
    • How to make the spreadsheet more simple to avoid manual manipulation of invidual cells.
• Three metrics for % Returns:
  • % Returned (Overall):
    • Formula: Total Dividends divided by Currently Book Value.
    • Purpose: Takes absolute returns of both historical and latest Book Value. This shows how much the distributions cover existing Book Value.
    • Example (BCE): 17.6291%
  • % Returned (Average Yearly Book Value):
    • Formula: Total Dividends divided by Yearly Average Book Value.
    • Purpose: Smooths out the Overall distribution return by looking at the Average Book Value per Year. This shows how much the distributions cover the Book Value for the entire year.
    • Example (BCE): 32.3046%
  • % Returned (Yearly):
    • Formula: Yearly Dividends divided by Yearly Average Book Value.
    • Purpose: Purely looks at the year's returns. This is a reflection of the stock's average annual yield.
    • Example (BCE): 7.0183%