To our surprise, the most successful principle growth and highest income investing in stocks is not coming from the US. It’s surprising but we are seeing the best returns, hands down, out of Canada. The Dogs of the S&P 500, that we launched on 5-8-2020 is now up over 35%. In our last article we said it was up 17% in two months and claimed, “this story is just too good to be true.” Well it double from there.
The dividend rate is just above 7% and very attractive. The Dogs of Canada have, in a short time, outperformed all our dogs portfolio easily; not only does it have the highest income it has by far the highest return of principle.
We have been benchmarking the Dogs of the Dow against its mutual fund brother that uses a simple static approach. With our quarterly rebalancing, dynamic weighting and no cost trading, Durig’s Dogs of the Dow greatly outperform, in good and bad markets, a static mutual fund approach. So we do expect all of our dog portfolios to outperform in time, but not to this Dividend Dogs of Canada magnitude.
The returns are so strong, this portfolio will have a great return in 2020 overtime. We believe the Canadian Dividend Dogs will be in line with most of our Dogs portfolios over time. It’s worth noting that the Canadian Aristocrat is also having a robust year.
Our daily news about the riots in major cities, the elections, and of course Covid-19, is not affecting Canada anywhere close to the same scale. These Canadian-based companies provide very unique diversification, especially for a concentrated portfolio. All the companies are Canadian, and even though Canada shares the longest border with the US, and is English and some French, Canada has its own currency, economy, banking, and political system with a prime minister. Its economy is much colder, less populated, and heavily weighted to natural resources. This enables US investors to have a true and significant diversification, away from the US, while still attaining a very high dividend and being somewhat correlated to the US.
Canadian Dividend Dogs has 10 companies and is considered a concentrated portfolio of high dividend aristocrats companies located in Canada.
Dividend Dogs of Canada
Annual Cost: 0.50% or 1/8 of a percent per quarter.
Average Dividend Yield of About: 7.00%
Minimum Investment: $15,000
No Cost Transactions
Minimum Holding Period: None
First started at an amazing 7% rate. Bear in mind also that the Canadian Dividend Dogs are Canadian companies that have a history of raising their dividend each and every year. Knowing your dividend income should grow over time, even though the performance is outstanding the dividend is mostly unchanged.
The 7% dividend rates in Canada is one of the best rates we could find throughout the globe. The facts are that most industrial nations pay only a nominal interest rate, with some European countries, plus Japan are offering very low to negative interest rates. This global standard makes the 7% dividend even more attractive. When you add in the chance of principal appreciation, this dividend dog of Canada should be considered for diversified high yielding investment.
We offer our successful investment strategies of many Dogs Portfolios to other Charles Schwab Registered Investment Advisors through segregated accounts.