The Yield-Hungry Couch Potato
About a year ago, I started to take a real interest in investments particularly the couch-potato strategy. I created a few different portfolios with RBC's DI practice account, and thought I would share my results on the Yield-Hungry strategy.
With a balance of $75,000 I invested exactly as the Canadian Couch Potato strategy outlined (http://canadiancouchpotato.com/model-portfolios/) - I believe it may have changed slightly since, nonetheless. I apologize if the means of posting the screen shots is a little crude.
It also seems RBC DI practice accounts cannot account for dividends, either as cash or DRIP so I've accounted for them manually (amounts pulled from google finance).
A screen shot of my RBC account:
[IMG]http://postimage.org/image/59j6v34yf/[/IMG]
As you can see, book value of $75,127.96 market value of $77,559.70, increase of $2,421.71
Dividend payout calculations:
[IMG]http://postimage.org/image/sia1nusqr/[/IMG]
So $75,000 results in $3260.58 cash (not drip) per year or roughly 4.34% return. That's a total gain (including the market value change) of $5692.32 or 7.56%.
I think that's pretty great, considering the low volatility of the funds (in market value) and the likelihood of dividend payout (the amount changed slightly on some, but all hit their monthly payout all year).
Thoughts, comments, feedback?
Stop reading here if you want, but I had originally looked at setting this up for my mom's retirement. Originally with Investors Group for years, with a bunch of junky high MER MF's that went nowhere. Lack of volatility is paramount, ultimately I wanted to give her better accessibility her savings (all of her banking is with RBC). Her pension will meet her living expenses, this is to cover things like emergency expenses, travel, that sort of stuff. I would probably simplify this portfolio, and focus on the top returning 4-6 funds. Again, lack of volatility is extremely important so if not this, I would probably look at a GIC ladder set up. The way I see it, base amount shouldn't fluctuate too much and the cash flow pays for a few trips a year without touching the principle. Does this set up seem to fit this situation? I don't want to commit her savings to this and miss something...
With a balance of $75,000 I invested exactly as the Canadian Couch Potato strategy outlined (http://canadiancouchpotato.com/model-portfolios/) - I believe it may have changed slightly since, nonetheless. I apologize if the means of posting the screen shots is a little crude.
It also seems RBC DI practice accounts cannot account for dividends, either as cash or DRIP so I've accounted for them manually (amounts pulled from google finance).
A screen shot of my RBC account:
[IMG]http://postimage.org/image/59j6v34yf/[/IMG]
As you can see, book value of $75,127.96 market value of $77,559.70, increase of $2,421.71
Dividend payout calculations:
[IMG]http://postimage.org/image/sia1nusqr/[/IMG]
So $75,000 results in $3260.58 cash (not drip) per year or roughly 4.34% return. That's a total gain (including the market value change) of $5692.32 or 7.56%.
I think that's pretty great, considering the low volatility of the funds (in market value) and the likelihood of dividend payout (the amount changed slightly on some, but all hit their monthly payout all year).
Thoughts, comments, feedback?
Stop reading here if you want, but I had originally looked at setting this up for my mom's retirement. Originally with Investors Group for years, with a bunch of junky high MER MF's that went nowhere. Lack of volatility is paramount, ultimately I wanted to give her better accessibility her savings (all of her banking is with RBC). Her pension will meet her living expenses, this is to cover things like emergency expenses, travel, that sort of stuff. I would probably simplify this portfolio, and focus on the top returning 4-6 funds. Again, lack of volatility is extremely important so if not this, I would probably look at a GIC ladder set up. The way I see it, base amount shouldn't fluctuate too much and the cash flow pays for a few trips a year without touching the principle. Does this set up seem to fit this situation? I don't want to commit her savings to this and miss something...