FFJ Portfolio – November 2017 Dividend Income Report

(Last Updated On: November 30, 2017)


November is one of the 4 months of the year in which the FFJ Portfolio generates the least amount of monthly income. In November, CDN $510.44 and USD$778.42 was received.

I augmented this income by writing 4 covered calls on J.M. Smucker (NYSE: SJM) which expire July 20, 2018. After taking into consideration the commission and the USD to CDN FX conversion I netted $1,463.86. This transaction makes up the bulk of the CDN $1579.75 cash in Investment Account #5.

I decided to write covered calls on the SJM shares held in the account since I am of the opinion that these shares will trade in a tight range and will not reach the $125 strike price by July 2018. If the stock stays below the $125 level, I will retain the shares and the premium I received. Should the shares breach the $125 level, I will reassess what I want to do before I get called away. At this point, my inclination would be to close out the position and to write new covered calls at a higher strike price further out on the calendar.

On the portfolio composition front, I deployed some available funds toward the elimination of the leverage in one of our Canadian dollar investments accounts. The Canadian cash position in Investment Account #1 was ($39,166.18) as at October 31, 2017. The Canadian cash position in this account is now $78.50. This explains the vast majority of the ~$41,000 increase in the value of the overall Canadian holdings between October 31st and November 30th.

The ~$30,000 increase in the value of the US holdings during the month of November is because the market has been on a recent tear. Every US holding within the FFJ Portfolio experienced an increase in value relative to October 31st.

As an investor with a long-term investment time horizon I pay little attention to daily fluctuations in equity values. I agree that it brings comfort to see an increase in value in one’s portfolio from one month to the next. It does, however, give me concern when I see rapid increases in equity values as it harkens back to previous periods of market frothiness which were followed by market corrections.

I know I cannot time the market, and therefore, I leave my existing equity positions as is. There are, however, additional funds on the sidelines which will be deployed if/when we do experience a significant overall market correction or if certain companies of interest to me retrace to reasonable valuations.

As far as goal setting goes, I have been giving this some thought over the past couple of months. There are currently a lot of moving parts which is making the process more difficult but I know that setting stretch goals is imperative. I will communicate my 2018 FFJ Portfolio dividend income target once I have nailed it down.

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