Outlook for September 2015

Outlook-Sep2015

What a volatile market! August saw some insane movements – from a 1000-point Dow Jones Industrial Average (DJIA) drop at market open on Aug 24th, to a stunning recovery a couple of days later. Market volatility has been expected for a while now and with the Fed on the verge of raising interest rates, it provides a great opportunity for long term investors to initiate/add to positions in the midst of the panic. There are equal number of proponents and opponents for interest rate hikes by the Fed. One thing for sure is that even if they do raise the rates, it will be a small token 25 basis points raise and the rates are not going to shoot up anytime soon. The world still stares deflation in the face with a strong US$ and collapse in the commodity markets, coupled with a weak demand from China.

On the Canadian front, after having two 25-basis points rate cuts in Jan and Jul of this year, some economists are already predicting another rate cut to take effect during the September meeting. The interest rates are already at record low at 0.50% and any rate cut will continue fueling the housing market bubble in Canada in an effort to prop up the economy, now that Canada is in a recession.

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Recent Buy – Canadian National Railway

CNR

The stock market is going through some wild swings. There are plenty of reasons for the overall sentiment to be down for active traders, but that just means a great opportunity for long term investors to pick up some quality companies in the midst of the panic. Whenever I make a purchase, I like to share my buys to document and illustrate how I am building my income stream over the course of months/years. My main goal is simply to keep investing at regular intervals and build my passive income over the course of time. This is one last purchase for the month of August, adding to an existing position.

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Sunshine Blogger Award

This post is inspired by Bryan at Income Surfer who nominated me for the Sunshine blogger award. For those unfamiliar, this is a fun way of sharing details about the nominated blogger (in this case, me) with a few questions posted by the person nominating. Thanks for the nomination, Bryan.

1. Name the top three experiences from your past, that help form who you are today.

  • Having a near-death experience. I fell off a cliff a few years ago and ended up with injuries that could have either killed me or left me paralyzed, but as luck may have it, I just came off it with just some cuts and scrapes, some fractures and a new found love of life. This caused me to re-evaluate a lot of things in my life and do some soul searching. I would say that a big part of me today is because of that experience.
  • A death of a close family member. Again – nothing like death to remind you how precious life is, right? A death of a close family member shook me up and reminded how important it was to take care of myself and people I care about. I used to be quite overweight and it was a wakeup call and decided to live a much healthier and active lifestyle after that. Even to this day, living and maintaining a healthy lifestyle remains a top priority for me.
  • Seeing people around me not plan ahead financially enough. Time and again, I’ve seen too many people not have a game plan when it comes to retirement and living paycheque to paycheque, while spending on unnecessary things. I started saving for my retirement the moment I was out of university and got a full-time job.

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Chatter Around the World – 111

Chatter Around the World is a curated weekly update of articles related to economics, investing, dividends and personal finance. In these weekly updates, I also capture my blog updates and news related to my portfolio holdings.

MW-DS526_sp_reg_20150819104334_ZH

S&P 500 Revenue Diversification

Image Source: Market Watch

Let’s dive into the links that caught my attention this week.

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Bank of Nova Scotia (BNS) Dividend Increase

Scotiabank

Bank of Nova Scotia (BNS) (BNS.TO) announced a 2.94% increase in its cash dividend. The quarterly cash dividend will increase from $0.68 to $0.70 per share and payable on Oct 28, 2015 to shareholders on record as of Oct 6, 2015 and ex-div date of Oct 2, 2015. This is the second dividend increase in 2015 and the dividend is up 6.06% from a year ago.

Forward yield based on current stock price is 4.67%.

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