Recent Sell – Index Funds

I’ll keep this short. Another couple of sales to report in our portfolio.

Last week I sold two index funds that we’ve owned only since last year (holding period of about 18 months):

  • BMO S&P/TSX Capped Composite Index ETF (ZCN.TO)
  • Vanguard FTSE All World Ex-Canada Index ETF (VXC.TO)

Recent Sell Decision

  • This stock market continues trading at crazy valuations while all fundamentals have collapsed underneath. I am cashing out at what I consider to be market tops.
  • Yes, this is market timing.¬†Get over it ūüôā

Overall return (including dividends during holding period of 18 months):

  • 3.6% for ZCN.TO
  • 4.2% for VXC.TO

Recent Sell – Magna International

Magna International

Another sale from my portfolio. Regular readers may be aware that I have been liquidating a lot of my portfolio as this market enters the nosebleed section. Valuations are at all-time highs and the world of finance looks just as dangerous as last decade, if not worse. I am of the opinion that holding large positions of cash going into the next crisis is a better strategy than trying to stay invested and trying to squeeze out an extra 1% or 2% in dividends or capital gains.

I sold 50 shares in Magna International Inc (MG.TO) @ C$57.00 and closed my position.

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Recent Sell – Bank of Nova Scotia

Another sale from my portfolio. Regular readers may be aware that I have been liquidating a lot of my portfolio as this market enters the nosebleed section. Valuations are at all-time highs and the world of finance looks just as dangerous as last decade, if not worse. I am of the opinion that holding large positions of cash going into the next crisis is a better strategy than trying to stay invested and trying to squeeze out an extra 1% or 2% in dividends or capital gains.

Last week, I sold 45 shares in Bank of Nova Scotia (BNS.TO) @ C$71.00 and closed my position.

Recent Sell Decision

  • I have been selling for a variety of reasons — including market valuations, herd mentality from other investors, simplicity focus I desire and SWAN reasons. I have detailed all these thoughts in this post.
  • While the valuation of this particular stock is fine — its not overpriced by any measure, I decided to simplify my life and reducing the number of holdings. I want to follow a more concentrated approach to investing and betting big on a smaller set¬†of companies. ¬†So, the decision came down to whether I want to own two Canadian banks (the other one being Toronto-Dominion Bank (TD)), which have the similar exposures operating and competing with each other. After some consideration, I decided that I want to own just one. TD’s balance sheet, risk-profile and growth prospects are better in my opinion. This led me to decide to liquidate BNS and exit the position.

Total profit (including dividends during holding period of ~2 years): 12.47%

Full Disclosure: Long TD. Our full list of holdings is available here.

Recent Sell – Realty Income Corp

Realty Income

As most regular readers are aware, I have been liquidating some¬†of my holdings lately. This has been driven by a few different reasons –¬†driven by a combination of market conditions, complacency in the market, lack of belief in individual holdings, the yearn for simplicity provided by index funds etc. Some of these reasons have been summarized in this post. This post captures another recent sell in my portfolio.

As the market continues to hover around all time highs, I have been thinking more about investor psychology and introspecting my own mentality. Recently I posted an article entitled “Do You Love Your Investment Holdings?” detailing how investors can fall in love with a holding and try to justify it even when the evidence points to investors to come to different conclusions instead. This can be driven by familiarity and a bias that comes with ownership of shares in a company for a prolonged period of time. This is a common pitfall that investors fall for and I came to the conclusion that I was facing the same issue¬†with this holding. While this particular company is one that I didn’t quite love, I have noticed that most investors in the community seem to love it thanks for the dividends.

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Recent Sell – Qualcomm Inc

As most regular readers are aware, I have been liquidating some¬†of my holdings lately. This has been driven by a few different reasons –¬†driven by a combination of market conditions, complacency in the market, lack of belief in individual holdings, the yearn for simplicity provided by index funds etc. Some of these reasons have been summarized in this post. This post captures another recent sell in my portfolio.

As the market continues to hover around all time highs, I have been thinking more about investor psychology and introspecting my own mentality. Recently I posted an article entitled “Do You Love Your Investment Holdings?” detailing how investors can fall in love with a holding and try to justify it even when the evidence points to investors to come to different conclusions instead. This can be driven by familiarity and a bias that comes with ownership of shares in a company for a prolonged period of time. This is a common pitfall that investors fall for and I came to the conclusion that I was facing the same issue¬†with this holding. Coming to this realization, I decided to sell my shares and exit this investment.

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