Nearly a dozen stocks including Bank of Nova Scotia, Bank of Montreal, Canadian Imperial Bank of Commerce, BCE Inc., Enbridge Inc., TransCanada Corp., and TransAlta Corp.
Ken Cenerelli has been investing for over 10 years. He is also a member of one of the investment clubs set up by the Canadian MoneySaver magazine under the ShareClub banner.
How he invests
Mr. Cenerelli is building a portfolio of blue-chip stocks with growing dividends for retirement. "I am a true buy-and-hold investor."
Dividend reinvestment plans (DRIPs) are used to reinvest dividends automatically and without commissions. Many DRIPs also allow commission-free purchases of company shares at market price discounts of up to 5 per cent.
In addition to the reduction in investment costs, Mr. Cenerelli likes having his DRIP stocks "roll on autopilot with only minimal supervision." The one thing he doesn't like about DRIPs is that a few weeks can pass between sending the cheque in and when the stock is purchased.
He believes in dollar-cost averaging (buying a fixed dollar amount of a stock at regular intervals, which results in buying more shares when prices are low).
He has a 125-per-cent capital gain on Enbridge.
"I took a big hit on TransAlta when they cut their dividend …"
"Look into Canadian MoneySaver ShareClubs. They are filled with people turned on to the idea of dividend stocks and DRIP investing."
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