A few weeks earlier, I asked you what you thought I should do with the $3500 I had put into my Tax Free Trading Account with Questrade.

I was deliberating between buying some BMO bank stocks (I currently only own 45 shares) or adding more HSE Husky Energy (I recently bought 100 shares).   My TFSA portfolio included about 10% in ETFs and the rest of the portfolio was dividend producing stocks.  Needless to say, the allure of dividend investing really attracts me.

However, this quickly changed when I realized that I hadn’t balanced my ETF portfolio for the year.  When I looked at the pie chart of my portfolio, I saw that the ETFs were a teeny tiny portion of my entire portfolio.  I’m a visual person and seeing this helped me realize that I needed to incorporate more ETFs.

Also, looking back at my investing journal, I had sold an entire ETF from my lazy couch potato portfolio (it was recommended by Money Sense) which included 25% proportions in each XDV, CYH, CPD, and XTR.  When I read my investing notes, it seems like I sold XTR in 2010 to get enough capital to buy some dividend stocks.  At the time, I probably told myself that I would just buy them back… but it seems like I never did.

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It seems customary that I share what my purchases were for the year in terms of my TFSA Trading Portfolio with Questrade.  If you want to take a peek at my 2010 and 2011 TFSA acquisitions, feel free to check out these articles.  As many of you now, instead of using my TFSA as a savings account, I use my TFSA as a Trading account (or more accurately, my dividend investing account).

Unfortunately the dividend tax credit was decreased quite a bit in 2011 and 2012 so it makes sense (to me at least) to put my dividend darlings into the TFSA.  The main reason for this is if or when I sell my dividend stocks (I would prefer the if and not when in the near future since I have little patience for long term gains), then I won’t have to pay taxes or capital gains on the sale of my dividend stock.

Of course, there is a downside to this as well.  If the stock I put in the TFSA is a real doozy (which has definitely happened), my hands are tied and I cannot use the loss as a capital loss to offset future capital gains.

Over the past year, I moved my Bank of Montreal (BMO.TO) shares into my TFSA.

In addition, I moved Fortis (FTS.TO) into my TFSA from my nonregistered account in 2011.

The only activity that I have this year is buying 100 shares of Husky- HSE.TO (I know it’s not much, but I hope to add more).

I have $3500 cash in my TFSA account itching to be included in the TFSA portfolio.

I see a few options here:

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Since I’m going back to school in September, I have started to reminisce about the good ol’ times of my undergraduate degree, when I had absolutely nothing to worry about except to get good grades, work at my care-free retail part-time job, and party on the weekends to try and score free drinks from boys.  I had a pretty balanced student lifestyle, I was active in the school clubs and committees, I worked, I studied, got some scholarships, and I partied.  It was a pretty fulfilling undergrad.

I regret that I partied so much and wasted all that money I worked so hard to make.  But hey, you’re young only once, right?  However, there is something else I regret.

I wish I had started investing earlier.  I met a guy in college who was passionately involved with stock picking and trading (can you say HELLO what a turn on??) and his passion rubbed off on me.   He would do this instead of working a part-time job earning $9.50 an hour like I did, and he paid his way through university with his investments.  Inspired, I bought one or two stocks through my mom’s BMO Investorline brokerage, because at the time I didn’t have a brokerage account.  Thinking back, it was my first lesson in investing, don’t take hot stock tips from friends and acquaintances, especially if you don’t understand what you’re buying!

But I digress.  The old days of expensive brokerage accounts and commissions have vanished.  Things have changed, fast forward to 2011 and young Canadians these days are so lucky- they have the option of contributing to a TFSA.

In case you haven’t heard, a TFSA is a Tax Free Savings Account introduced by the government a few years back.   In a nutshell, you have to be 19 years and older to contribute to one and you can contribute $5000 per year of your after tax income.  You can withdraw the money any time but must wait until the next calender year to put that money back (only if it exceeds your combined contribution limit) or else you’ll be dinged with over-contribution charges.  If I were 19 now and a student, I would invest in a TFSA rather than an RRSP, that’s for sure.  I would also enjoy my beautiful youthful looks too HA!

As a student, you may think you’re at a disadvantage because you ARE a student and are relatively income-less, but you have time on your side.  Time my friend, is a very beautiful thing.

Here are the TFSA options:

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This is the last of the four part series in which I disclose in a sneaky and mysterious manner what I’m holding in my Tax Free Trading Portfolio for 2011.  In the first part of the series, I talked about Exchange Income Corporation (the aviation/manufacturing company), the second part I mentioned Just Energy, and last week, I talked about Sun Life. This week, the last stock I bought for my 2011 portfolio is very different from the above manufacturing/ utility/ and financial industries.

I had thought about owning this stock for a bit of time, ever since I did a post on it recently.  However, I was again hesitant due to the nature of the sector and the state of the economy.  How can a company that is considered a “non-essential” part of life possibly do well?

My mind changed, however, when I paid a visit last year (whereby the economy was still wobbly and the markets were schizophrenic).  The place was absolutely packed and people were having a good time.  Money was being spent like you would not believe (not too much by me, of course… it was just an observation on my part by looking around the room).  I thought…recession, what recession?

This company did not incorporate and instead stayed on as an income trust (and I am glad I’m holding it in my TFSA of course, otherwise I would be taxed to the nines).  Because of the taxation on the company thanks to the new Specified Investment Flow-Through Trust Tax “The SIFT Tax”, the distributions have decreased from $0.11 a month per share (about 9.9% annual yield) to $0.08 a month per share (about 7.2% annual yield at recent price point).  This is the only holding in my portfolio that has actually stayed on as an income trust.  All the other ones converted to dividend paying corporations.

Recent Year end Results have been good and better than expected.  Their financial information looks solid too.

• P/E of 10.79
• Price to Book Ratio of 1.29
• Huge Gross Margins of 93 when the sector average is a measly 8.76  (I guess they get their product from Alberta on the cheap!)
• It is near the 52 week high though (hmm what isn’t?   )
• Annual yield from distributions of 7.2% paid monthly
• The main company office is based right here in Vancouver (well, actually Richmond, but same thing, right?)
• First started in North Vancouver in 1971 and now has over 100 locations all across North America
• Their commercials are very alluring and seem to stimulate your senses
• Since 2003, holds the title of One of Canada’s Top 50 Employers compiled by Aon Hewitt every year.

Alright enough beating around the bush… did you guess it?  I was very vague about it because it’s very easy to guess.

One major hint- I talked about it in the Cheap and Good Eats Section (it’s a Good Eat, and not a Cheap Eat).

If you guessed The Keg- You’re the winner!  I might treat you out to the Keg if you guessed it right (sorry, got your hopes up!).

Next time I go to the Keg, I’ll feel better ordering that glass of wine and a steak, knowing that I own a small portion of that company and am getting paid monthly for good earnings and profit.  It’s a seemingly win win situation, I tell you.  And you know I’m a fan of those.

I don’t think I would hold on to it for long term though, nor do I think I will be adding to my current position to KEG.UN.TO.  I’ll wait and see how it performs.

Readers, would you buy equity in the restaurant industry or does buying in the restaurant sector seem too risky?

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Here’s part three of the five part series on what I’m holding in my TFSA. We’re halfway through, so just one more Wednesday of putting on your thinking caps and guessing what equity I bought and it’ll be back to my regular posts.

In this series, I am sharing what my holdings are (or what I bought) in my Tax Free Trading Account for 2011. I had income trusts in 2010 and sold them all off due to being weary about what might happen come January (which is now a few months ago– time flies!) when they slash their distrubutions due to them being incorporated.

The last two weeks, I talked about EIF.TO and then JE.TO both doling out huge dividends (8-9% annually). This week, you can try to guess the next holding I have in my small TFSA portfolio.

Here goes- put on your thinking caps:

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