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me and my money

Gurjit Sidhu

Gurjit Sidhu


Magnetic resonance imaging (MRI) technologist.


Includes shares in Bank of Montreal, Fortis Inc., Telus Corp., Johnson & Johnson, Bank of Nova Scotia, Enbridge Inc. and PepsiCo Inc.

The investor

Gurjit Sidhu has stayed the course since he appeared in the Me and My Money column during the spring of 2012. He's still a dividend investor looking to build up a "certain level" of income. "I have been very happy with my investing … and am confident I will see the benefits," he reports.

How he invests

Falling markets put Mr. Sidhu in a good mood, believe it or not. The reason is simple: He can acquire his income streams more cheaply.

Dividend investing also means freedom from the emotional roller-coaster ride of market fluctuations. All that matters to him is that his companies maintain and increase their dividends.

This they have done, handily, over the past four years. His portfolio's dividend income has more than doubled thanks to dividend increases, stock purchases and reinvestment of dividends. It's gotten to the point where "my contributions make less of a difference and the compounding of dividend reinvestment and dividend hikes … make a greater difference," he says.

Dividend growth has been especially helpful. "For example, reinvesting the dividend on Enbridge shares four years ago purchased 0.8 of a share; more recently, the dividend purchased about 2.5 shares," Mr. Sidhu notes.

Another factor is his determination to keep costs low. He switched to Interactive Brokers, which "charges much lower commissions than the more popular brokerages." And he uses company dividend reinvestment plans to reinvest dividends cost-free and to make no-fee purchases of new shares – often at discounts of up 5 per cent from the market price.

Then there is the strategy of augmenting portfolio income by selling put options on stocks. The option sales generate income, and if they expire worthless, nothing further needs to be done. If the price of the stock falls to the option's strike price, Mr. Sidhu has to buy the stock. But this is okay if it's a company he wanted in his portfolio anyway.

Best move

"Diversifying, focusing on quality companies and trying to stay patient."

Worst move

"Investing in companies that offered higher yields … but I didn't understand enough. The dividend was not as reliable as it appeared: Examples are Kinder Morgan and BHP Billiton. Luckily, this didn't happen with my bigger positions …."


"Learn, read, figure out what plan is going to work best for you in the long term. Save as much as you can … the more you save, the more you have to work your plan."

Want to be in Me and My Money? Contact Larry MacDonald at or his website.

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