Interest rates on the rise… or not!

In opposite direction to interest rates, fixed income investments have been going down in price.  In my portfolio, my fixed income allocation is filled with preferred shares.  During November, the decrease in price has been noticeable.  So much so that my Allocation of funds indicated that it was time to sell off some common shares to move over to fixed income and buy additional preferred shares.

Also typically moving in opposite direction to increasing interest rates are another result of changing interest rates is the changing price of interest sensitive stocks such as Real estate (REIT) and Utilities.  These two sector’s impressive growth in November seems to indicate that the markets believe interest rate increases are over.  Nonetheless, my stock allocation indicated that these two sectors were overweight.  Therefore, I did some “pruning” by selling some shares.  Interesting note, stocks in these two sectors were having a bad 2018.

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In November, three sectors spiked up in price.  Therefore, I sold some of the following stocks :

  • American State Water (AWR-N) – Utilities
  • RIO CAN (REI.UN-TO) – Real estate
  • Johnson & Johnson (JNJ-N) – Health

With the sale proceeds and the monthly dividends I added to these not so popular stocks :

  • AFLAC (AFL-N) – Finance
  • Canadian Western Bank (CWB-T) – Finance
  • Dollarama (DOL-T) – Basic consumption
  • Helmerich & Payne (HP-N) – Energy
  • Oracle (ORCL-Q) – Technology
  • Tecsys (TCS-T) – Technology

Please note that these stocks are not recommendations.  Stock picking is very personal.  So please have fun selecting your own “businesses”.

Until next month,