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I know, it’s a long way from RRSP season. But your retirement plan shouldn’t be ignored once you’ve made your annual contribution. It should be reviewed at least every six months (quarterly is even better) to ensure it’s performing to the standards you set and whether any changes are needed.

That’s why we’re reviewing our model RRSP portfolio in August.

This portfolio was launched nine and a half years ago in February, 2012. It has two main objectives: to preserve capital and to earn a higher rate of return than you could get from a guaranteed investment certificate. The original value was $25,031.92.

Almost 30 per cent of the portfolio is in bonds and cash. The balance is in growth-oriented assets that offer exposure to the Canadian, U.S. and international equity markets. The portfolio contains a mix of exchange-traded funds, stocks and limited partnerships so readers who wish to replicate it must have a self-directed RRSP with a brokerage firm.

These are the securities currently in the portfolio with comments on how they have performed since the last review. Results are as of the close on Aug. 12.

PIMCO Monthly Income ETF (PMIF-T). This global bond fund lost a little ground in the latest period, slipping 21 cents a unit. But we received distributions of just under 20 cents a unit, so the setback wasn’t significant.

iShares Canadian Universe Bond Index ETF (XBB-T). This ETF tracks the performance of the total Canadian bond universe including government and corporate issues. This is a bad period for bonds and the units declined 92 cents. That was only partially offset by distributions of 41 cents a unit.

iShares Canadian Corporate Bond Index ETF (XCB-T). This fund invests exclusively in corporate issues. It was added to the portfolio in February, 2019. In the latest period, it lost 19 cents a unit but that was more than offset by monthly distributions totalling 31.3 cents.

iShares Convertible Bond Index ETF (CVD-T). This fund invests in bonds that can be converted into common stocks under certain conditions. It offers a play on the stock market while providing cash flow. The units gained 39 cents in the latest period plus we received distributions of just under 43 cents a unit.

iShares Core U.S. Aggregate Bond ETF (AGG-A). This ETF aims to replicate the returns of the total U.S. bond market. It was added in 2019 to give us more exposure to American bonds. The units are down $1.43 since the last review but we received distributions of $1.023.

Harvest Tech Achievers Growth and Income ETF (HTA-T). This portfolio originally had no technology exposure, so we added this ETF a year ago at a price of $12.40. The fund invests in an equally weighted portfolio of 20 large cap tech companies such as Apple Inc., Cisco Systems Inc., Facebook Inc. and Adobe Inc. The managers write covered call options to generate income. The units gained $2.30 over the past six months, plus we received 39.6 cents a unit in distributions. Total return during the period was more than 18 per cent.

iShares Edge MSCI Minimum Volatility USA Index ETF (CAD-Hedged) (XMS-T). XMS invests in low-beta U.S. stocks such as Coca-Cola Co., Visa Inc., McDonald’s Corp. and Verizon Communications Inc. Low beta means they are less sensitive to broad market movements and, in theory, less risky. The fund posted a gain of $3.71 in the past six months and delivered quarterly distributions totalling 18.6 cents a unit.

BMO Low Volatility Canadian Equity ETF (ZLB-T). This ETF invests in a portfolio of large-cap Canadian stocks that have a low beta history. It’s up $5.92 since the last review, plus we received two quarterly distributions for a total of 48 cents.

BMO Low Volatility International Equity Hedged to Canadian Dollar ETF (ZLD-T). This ETF focuses on international stocks and is hedged to Canadian dollars, so the currency risk is removed. It gained $2.69 in the latest period and distributions totalled 30 cents a unit.

Brookfield Renewable Energy Partners LP (BEP.UN-T). This Bermuda-based limited partnership owns a range of renewable power installations (mainly hydroelectric but also some wind and solar). It has been one of the driving forces of this portfolio, but the units got ahead of themselves as money poured into green energy stocks last year. We paid the price for that in the latest period, with the units dropping $10.77.

Brookfield Renewable Corp. (BEPC-T). This is the spinoff corporation from Brookfield Renewable Partners. Like its limited partnership twin, it also took a beating in the latest period, losing $11.66 a share.

Brookfield Infrastructure Partners LP (BIP.UN-T). This limited partnership invests in infrastructure projects around the world. As with BEP, it has also spun off a Canadian-based corporation, known as Brookfield Infrastructure Corp. (BIPC-T). The units have fared much better than BEP.UN, gaining $4.32 in the latest six months. We received two distributions of 51 US cents each.

Brookfield Infrastructure Corp. (BIPC-T). This is the corporate spinoff from BIP.UN. The share price is up $3.16 in the latest period. Dividends are the same as with its limited partnership twin.

BCE Inc. (BCE-T). BCE rebounded well from a bad run in 2020 and the stock gained $8.33 in the latest period. The quarterly dividend was raised to 87.5 cents effective with the March payment.

Interest. We invested $2,353.99 in an Alterna Bank High Interest Savings Account, paying 1.2 per cent. We received $14.12 in interest.

The table below shows how the RRSP Portfolio stood as of Aug. 12. Commissions have not been factored in and Canadian and U.S. currencies are treated at par for ease of tracking.

IWB RRSP Portfolio (as of Aug. 12)

Weight %SharesAvg. priceBook valueCurrent priceMarket valueRetained incomeGain/Loss %
PMI-T7.2220$19.87 $4,371.20 $20.11 $4,424.20 $82.08 5
XBB-T10.4200$33.04 $6,608.21 $32.00 $6,400.00 $330.18 1.8
XCB-T3.6100$21.04 $2,104.00 $21.95 $2,195.00 $159.00 11.9
CVD-T3100$18.16 $1,816.00 $18.65 $1,865.00 $207.87 14.1
AGG-A3.820$113.32 $2,266.40 $115.55 $2,311.00 $99.04 6.3
HTA-T11.3410$12.46 $5,107.00 $17.00 $6,970.00 $182.56 40.1
XMS-T8150$28.19 $4,228.50 $32.93 $4,938.00 $202.02 21.5
ZLB-T9.8150$31.43 $4,714.50 $40.18 $6,027.00 $342.00 35.1
ZLD-T4.3100$24.04 $2,404.00 $26.33 $2,633.00 $148.00 15.9
BEP-UN-T11.8150$19.59 $2,939.06 $48.44 $7,266.00 $445.83 162.4
BEPC-T3.237$19.86 $734.79 $52.80 $1,953.60 $41.48 171.5
BIP-UN-T13.6120$26.00 $3,119.68 $69.92 $8,390.40 $326.39 179.4
BIPC-T3.325$45.12 $1,127.98 $80.66 $2,016.50 $56.06 83.7
BCE-T6.260$65.07 $3,904.20 $63.72 $3,823.20 $199.92 5.3
Cash0.5$307.14 $321.26
Totals100$45,752.66 $61,534.16 $2,822.43 40.7
Inception$25,031.92 157.1

Comments: Had it not been for the big drop in Brookfield Energy Partners, we would have experienced a strong gain during the latest period. The bond sector was pretty much flat overall while all our equity holdings except BEP.UN and BEPC gained ground. We had decent contributions from our low volatility funds, BCE, BIP, and Harvest Tech Achievers ETF.

The net result was a gain of 3.6 per cent for the six-month period. Over the nine and a half years since the portfolio was launched, we have a total return of 157.1 per cent. That’s an average annual growth rate of 10.45 per cent, well above target.

Changes: The portfolio is performing well overall, but I would like to add a utility to our holdings and reduce our heavy weighting in Brookfield. Accordingly, we will sell BEPC and BIPC, for a total of $4,067.64, including retained earnings.

We’ll use the money to buy 70 shares of Fortis Inc. (FTS-T) at $57.67 for a total cost of $4,050.90. We’ll add the remaining $16.74 to our cash reserve.

As well, we’ll use retained earnings to add to other positions as follows:

CVD – We’ll buy 10 units for $18.65 each ($186.50 total cost). Cash remaining will be $21.37.

HTA – We will add 10 units at $17, for a cost of $170. Our retained earnings will drop to $12.56.

The new cash balance (including retained income) is $2,706.39. We will move it to the EQ Bank Retirement Savings Plan where the current rate is 1.25 per cent.

Here is the revised portfolio. I’ll review it again in February.

IWB RRSP Portfolio (revised Aug. 12)

Weight %SharesAvg. priceBook valueCurrent priceMarket valueRetained income
PMIF-T7.2220$19.87 $4,371.20 $20.11 $4,424.20 $82.08
XBB-T10.4200$33.04 $6,608.21 $32.00 $6,400.00 $330.18
XCB-T3.6100$21.04 $2,104.00 $21.95 $2,195.00 $159.00
CVD-T3.3110$18.20 $2,002.50 $18.65 $2,051.50 $21.37
AGG-A3.720$113.32 $2,266.40 $115.55 $2,311.00 $99.04
HTA-T11.5420$12.56 $5,277.00 $17.00 $7,140.00 $12.56
XMS-T8150$28.19 $4,228.50 $32.93 $4,938.00 $202.02
ZLB-T9.7150$31.43 $4,714.50 $40.18 $6,027.00 $342.00
ZLD-T4.2100$24.04 $2,404.00 $26.33 $2,633.00 $148.00
BEP-UN-T11.7150$19.59 $2,939.06 $48.44 $7,266.00 $445.83
BIPUN-T13.5120$26.00 $3,119.68 $69.92 $8,390.40 $326.39
FTS-T6.570$57.67 $4,050.90 $57.67 $4,050.90 $0
BCE-T6.260$65.07 $3,904.20 $63.72 $3,823.20 $199.92
Cash0.5$338.00 $338.00
Totals100$48,328.15 $61,988.20 $2,368.39

Gordon Pape is editor and publisher of the Internet Wealth Builder and Income Investor newsletters.

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 16/04/24 11:59pm EDT.

SymbolName% changeLast
Pimco Monthly Income Fund
Ishares Core CDN Universe Bond ETF
Ishares Canadian Corporate Bond ETF
Ishares Convertible Bond Index ETF
US Aggregate Bond Ishares Core ETF
Harvest Tech Achievers Growth & Income ETF
Ishares Edge MSCI Mv USA ETF CAD Hgd
BMO Low Volatility CAD Equity ETF
BMO Low Vol Intl Eqty Hed To CAD ETF
Brookfield Renewable Partners LP
Brookfield Renewable Corp
Brookfield Infra Partners LP Units
Fortis Inc

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