Go to the Globe and Mail homepage

Jump to main navigationJump to main content

(Photos.com)
(Photos.com)

NUMBER CRUNCHER

A dividend portfolio approach that handily beat the index Add to ...

What we’re looking at

The money managers at TD Waterhouse Private Investment Counsel say a top objective of theirs is to deliver returns to clients that compare well with benchmark indexes but offer less risk. Okay, who doesn’t want that in today’s uncertain stock market environment? The question is, how to actually make it happen?

More Related to this Story

Our screen

In putting this portfolio together, TD Waterhouse sought companies with above-average yields and a record of consistent dividend increases. Stocks were also selected on the basis of having a price-earnings ratio that is attractive in its own right and also relative to earnings growth.

Also used here is the price-to-book ratio, which compares a company’s value on the stock market to its value according to its financial statements. A lower reading suggests a stock is undervalued. Return on equity looks at how effective a company is at using the money put up by shareholders to generate profits. The higher the ROE among companies in the same sector, the better.

What we found

The goal of this portfolio is to generate strong total returns based on reliable and growing dividend income plus moderate capital growth. The net result has been an annualized total return since May, 1995, of 13.3 per cent, which compares to 9.9 per cent for the S&P/TSX 60 index. Returns from the portfolio have been more than enough to come in ahead of the S&P/TSX 60, even after advisory fees are paid.

The portfolio’s volatility has been much lower than the benchmark, according to TD Waterhouse. Using a measure called standard deviation, the portfolio came in at 11.8 per cent and the S&P/TSX 60 at 16.6 per cent.

Follow on Twitter: @rcarrick

 

TD Waterhouse Private Investment Counsel Canadian Dividend Portfolio

Company Ticker Sector Portfolio weight % (Sept. 28/12)
Top 10 holdings
Royal Bank of Canada RY-T Financials 7.1
Enbridge Inc. ENB-T Energy 6.9
Bank of Nova Scotia BNS-T Financials 6.8
TransCanada Corp. TRP-T Energy 6.0
Bank of Montreal BMO-T Financials 5.6
Canadian Utilities Ltd. CU-T Utilities 4.3
Canadian National Railway Co. CNR-T Industrials 4.2
Cdn. Imperial Bank of Commerce CM-T Financials 3.9
Emera Inc. EMA-T Utilities 3.8

Source: TD Waterhouse Private Investment Counsel

Print

Download table as a CSV file

View full table

  • RY-T
  • ENB-T
  • BNS-T
  • TRP-T
  • BMO-T
  • CU-T
  • CNR-T
  • CM-T
  • EMA-T
  • SJR.B-T
Live Discussion of RY on StockTwits
More Discussion on RY-T
Live Discussion of ENB on StockTwits
More Discussion on ENB-T
Live Discussion of BNS on StockTwits
More Discussion on BNS-T
Live Discussion of TRP on StockTwits
More Discussion on TRP-T
Live Discussion of BMO on StockTwits
More Discussion on BMO-T
Live Discussion of CU on StockTwits
More Discussion on CU-T
Live Discussion of CNR on StockTwits
More Discussion on CNR-T
Live Discussion of CM on StockTwits
More Discussion on CM-T
Live Discussion of EMA on StockTwits
More Discussion on EMA-T
Live Discussion of SJR.B on StockTwits
More Discussion on SJR.B-T

In the know

Most popular video »

Highlights

More from The Globe and Mail

Most Popular Stories