The Dividend Tactics

The Dividend Tactics

After several years of investing with some success and some mistakes, I concluded that there are three key challenges getting in the way of investors like you and me from achieving our investment goals:

  • Common investment products such as mutual funds charge fees but routinely under-perform, and do not allow for tailored investment customization to match individual investor needs.  Bonds and GICs limit risk, but low returns and loss of access to funds can prevent you from enjoying the success during a strong market, or from taking advantage of buying opportunities when they arise.
  • We are our own worst enemies.  Without defined rules in place to dictate what to invest in and in how, we are subject to the human error factor.  For a variety of reasons we buy too high and sell too low, we make these trades far too often.  We hold poor investments too long because we are not sure how or when to re-balance, and we play favourites based upon past performance or dividend yield levels.
  • We think we know more than we do.  We watch financial shows on TV, read books and gain an inflated sense of confidence.  We hear stories of success from friends and colleagues and blindly believe that we can achieve the same success, and our emotions cloud us from seeing warning signs until it is too late.

I came to the conclusion about three years ago, with the help of my friend Shiznit Stocks, that the best way for me to work towards achieving my investment goals was to attack to root cause of the problems identified above.  I decided to remove investment products such as mutual funds from my portfolio and developed clear, simple, mathematical rules to help dictate how I invest – a focus on the production of stable and growing dividend income, while still maintaining exposure for capital growth.

These mathematical rules are what I call my Dividend Tactics.  To me, they provide discipline, composure and clarity that strengthens the management of my investment portfolio – and I am more than happy to share my strategy with anyone interested.

home upgrade

The Surprising Yield of Simple Home Upgrades

Like most of my readers here at Dividend Tactics, I really love getting dividends from companies that I hold within my investment portfolio but I am not so fond of paying bills.  After I got my last electricity bill in the mail I recalled a study I performed a while back at work about how …

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passive v active trading

Active Trading vs. Passive Investing

The typical dividend growth investor, myself included, follows a buy and hold style where the day to day fluctuations of an individual stock are essentially ignored and the focus is instead directed on the receipt and reinvestment of dividends coupled with long term asset growth.  This strategy is also often referred to as passive investing, …

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DT Assessment: Russel Metals (RUS)

Russel Metals processes, manufactures and distributes tubular metal products amongst North America, with about 30 sub-companies operating under the Russel Metals brand.  A large percentage of their business is devoted to providing piping materials to the energy industry. Russel Metals has one of the longest operating histories of any company, not just in Canada, with …

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Eaton Corp

DT Assessment: Eaton Corporation (ETN)

Eaton Corporation is involved in power management and the provision of energy-efficient solutions within the electrical, hydraulic and mechanical power industries.  They have five main segments: Electrical, Hydraulics, Aerospace, Truck and Automotive.  Headquartered in Ireland with over 100,000 employees, they have been in operation for over 100 years and have an impressive record of 90 …

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