Investing

CM - Sell or Hold?

  • Last Updated:
  • Oct 15th, 2017 12:25 pm
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Jr. Member
Jul 29, 2010
144 posts
25 upvotes
ottawa
if your plan is to hold it long term, keep dripping and don't even worry about the price. don't even look at it. today's fluctuations are not going to matter in another 8 years.
Member
Feb 26, 2017
246 posts
62 upvotes
I think CM will work out well for you in the long run (I own TD, BNS and RY but I think all the big CDN banks are good investments).

It often feels like you need to do something with your stock portfolio. Unless your invested in risky companies or the fundamentals change the best move is almost always just holding what you have.
Deal Addict
Jan 22, 2006
2507 posts
1552 upvotes
Pickering, ON
Chance7652 wrote:
Oct 11th, 2017 9:05 pm
I think CM will work out well for you in the long run (I own TD, BNS and RY but I think all the big CDN banks are good investments).

It often feels like you need to do something with your stock portfolio. Unless your invested in risky companies or the fundamentals change the best move is almost always just holding what you have.
+1
#WeTheNorth
Sr. Member
Aug 17, 2008
543 posts
159 upvotes
Here's another way to look at your holding. Assuming no change in dividends, every quarter your average cost goes down by $1.30. In 15 years ($78/$1.30/4) , it will have cost you $0.00 to own a money machine.
Member
Mar 13, 2004
463 posts
47 upvotes
Brampton
I see a lot posts about setting up a DRIP but after following Rodbarc's threads in this forum, I avoid for my long term plays.

Ultimately, whether you DRIP or not should be based on how active you want to be with your portfolio and what you will do with your stock.
For ex. for my dividend growth (retirement) portfolio, I do not DRIP. I am actively involved with this portfolio and use my cash dividends to purchase well priced stocks.

For my growth portfolio, I do DRIP. Reason being if I have a target price, the more shares that I can accumulate before the target price then the more profit I make.

If you only want to own 1 stock (in this case CM) and you never plan to sell it, in that case it might also be worthwhile setting up a DRIP. An added benefit for CM is that it does provide a 2% discount for a DRIP.
Member
Feb 26, 2017
246 posts
62 upvotes
LeafsRbest wrote:
Oct 12th, 2017 3:35 pm
I see a lot posts about setting up a DRIP but after following Rodbarc's threads in this forum, I avoid for my long term plays.

Ultimately, whether you DRIP or not should be based on how active you want to be with your portfolio and what you will do with your stock.
For ex. for my dividend growth (retirement) portfolio, I do not DRIP. I am actively involved with this portfolio and use my cash dividends to purchase well priced stocks.

For my growth portfolio, I do DRIP. Reason being if I have a target price, the more shares that I can accumulate before the target price then the more profit I make.

If you only want to own 1 stock (in this case CM) and you never plan to sell it, in that case it might also be worthwhile setting up a DRIP. An added benefit for CM is that it does provide a 2% discount for a DRIP.
The other consideration is the size of your yearly dividends and how many accounts you have. I have 3 TFSA accounts, 2 RRSPs and a cash account so setting up drips saves a lot of commissions. I also don't have it set up for every stock I own.
Deal Addict
May 31, 2007
4239 posts
1376 upvotes
cessnabmw wrote:
Oct 11th, 2017 8:58 pm
Glad I'm still holding ☺
How come? Price has not gone anywhere.

It's a dog right now among the top 5. Being punished for overpaying of privatebancorp

I believe the market will come around and reward it, just like the other banks. So it's undervalued right now, compared to peers.
Deal Addict
Jul 3, 2006
1116 posts
174 upvotes
If Canada doesn't go in recession or Real Estate doesnt crash CIBC is best bank out of the others based on PE. I don't own CAD banks as CAD is to risky of a play for me at this moment
Deal Addict
Jul 23, 2007
3231 posts
1097 upvotes
Still own CM in the taxable account. No plans to sell. I learned from the financial crisis not to have too much weight in any one sector. Target allocation for the financial sector has been set at 15% since 2010.
Newbie
Feb 5, 2017
78 posts
39 upvotes
Time has come for me to invest my quaterly new 60K in the stock market on monday. Portfolio now 1.8M
my CDN allocation only 18% vs 22% goal.. choice between adding more to ZPR (7% of my portfolio), VCN (recent 4% increase in index looks too good to be true) or something else..

CIBC it will be.

I drip only in TFSA and RRSP in order to avoid fees and to not let money there doing nothing. However no DRIP in my non registered account which is my main account, 1.3M worth
Deal Addict
Jul 3, 2006
1116 posts
174 upvotes
alexcalvado wrote:
Oct 14th, 2017 9:58 am
Time has come for me to invest my quaterly new 60K in the stock market on monday. Portfolio now 1.8M
my CDN allocation only 18% vs 22% goal.. choice between adding more to ZPR (7% of my portfolio), VCN (recent 4% increase in index looks too good to be true) or something else..

CIBC it will be.

I drip only in TFSA and RRSP in order to avoid fees and to not let money there doing nothing. However no DRIP in my non registered account which is my main account, 1.3M worth
Is your 60k from dividends or work
Deal Addict
May 31, 2007
4239 posts
1376 upvotes
alexcalvado wrote:
Oct 14th, 2017 9:58 am
Time has come for me to invest my quaterly new 60K in the stock market on monday. Portfolio now 1.8M
my CDN allocation only 18% vs 22% goal.. choice between adding more to ZPR (7% of my portfolio), VCN (recent 4% increase in index looks too good to be true) or something else..

CIBC it will be.

I drip only in TFSA and RRSP in order to avoid fees and to not let money there doing nothing. However no DRIP in my non registered account which is my main account, 1.3M worth
This is great can I ask how did you get portfolio to that size? Have you been invested for long time?

*edit I see you are very high income and saving a lot in cp thread. :)
Deal Addict
User avatar
Apr 12, 2012
1374 posts
268 upvotes
Toronto
If one invests $100 in CM and each of the other big five Canadian banks for their dividend yield, assuming their 5-yr dividend growth rate is maintained and ignoring capital gains, also conservatively assuming dividends were just sitting in cash and not reinvested,

CM would grow to $231 in 12 years while TD (at div. gr. of 10.6% vs CM's 6.24% per yahoo finance) would become $237, exceeding CM only at end of year 11.

RY at div. gr. of over 9% p.a. actually would take more than 12 years to catch up since the starting yield of CM is so much ahead of the others. All the other three of the big fives would be behind. Since Canadian banks pay dividends even in the worst financial crisis like in 1929, 1987, 2000, 2008 etc., they are good substitute for fixed income which are yielding very low these days.

This is why the only two bank stocks I hold right now are TD and CM.

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