Canadian Dividend Reinvestment Plans (DRIPs)

There's an excellent resource out there for choosing dividend-paying companies. It's called the Mergent's Dividend Achievers list and there's a list especially for Canadians.

Every year Mergent's compiles a list of companies that have increased their dividends for five consecutive years. This would seem an easy task for most companies but there are only 35 firms on this year's list! Most of the banks are there but massive dividend payers like TransCanada Corp., BCE and TransAlta are all missing.

Some of the new companies added this year are: Atco Ltd., Canadian Western Bank, H & R REIT, Manulife Financial and Sun Life Financial.

Using this criterion for choosing companies that pay an ever increasing dividend is especially important for those investors who are looking to replace their salaries with dividend payments as they get older. A rising dividend will help these people keep pace with inflation.

However, don't disregard the importance of a growing dividend for those in their share accumulation period (like moi) as the growing dividend means it will allow me to purchase more shares on a quarterly basis through the DRIP.

So, if you are looking for an additional way of choosing a new DRIP, check out the Mergent's list here: Mergent's Dividend Achievers


Great prices on Brand New business books!

Although this post is a little late, for those of you who didn't know Manulife Financial has instituted a new dividend reinvestment plan.

Widely anticipated, the company has let the DRIPping community down by creating a plan that very fee laden. Although many U.S. companies have been putting fees on their DRIPs for years, Canadians have been relatively lucky by not having many plans that have additional fees for buying shares. Most though have fees for selling shares through the plans, with most averaging about $0.15 per share.

Manulife has created a program that has been described as the most fee instenisve DRIP on both sides of the border! Here's the particulars:

Optional Cash Payment Setup Fees: $15
Minimum Investment: $100
Reinvestmnet Charge: 5% of dividend payment
Sale: $20 per sale plus $0.06 per share

The plan particulars can be found here: Manulife Financial DRIP

Manulife doesn't seem likely they will change this plan which is a shame as it would have received great support from everyone I spoke to. Another Canadian insurance company, Sun Life, is now considering a DRIP. Let's hope that they do not follow Manulife's lead in demonstrating what a DRIP should be.

Ken

Free Shipping on Brand New books!

For those of you who are looking to play the energy market, I came across an excellent article from the Globe and Mail that charts the progress of Energy Stocks vs. Energy Trusts.

The article states that "Over the past three years, the average total return from the 15 largest oil stocks beat the average from the 15 largest trusts 24.7 per cent to 22.4 per cent. In the past 12 months, trusts beat stocks 34.8 per cent to 33.6 per cent (total returns include share or unit price gains plus dividends or distributions)."

Although the piece dates from May 2005, I believe there is still some worthwhile nuggets of information in here for those looking to find a true bargain.

Free Shipping on Brand New books!

I thought it about time that I made another update of the site. As you can see the table below has been updated to reflect the many changes DRIPs have seen over the past eight months.

I have added the following news plans:
1. ActivEnergy Income Fund
2. Brascan SoundVest Diversified Income Fund
3. Brompton Equal Weight Income Fund
4. Brompton Equal Weight Oil & Gas Income Fund
5. Brompton MVP Income Fund
6. Brompton Stable Income Fund
7. Business Trust Equal Weight Income Fund
8. Canadian Fundamental 100 Income Fund
9. Canetic Resources Trust
10. CML Healthcare Income Fund
11. Core IncomePlus Fund
12. Daylight Energy Trust
13. Faircourt Income Split Trust
14. Faircourt Split Five Trust
15. Flaherty & Crumrine Investment Grade Fixed Income Fund
16. Flaherty & Crumrine Investment Grade Preferred Income Fund
17. IndexPlus Income Fund
18. IndexPlus 2 Income Fund
19. ING Direct Canada
20. Ketch Resources Trust
21. Keyera Facilities Income Fund
22. Manulife Financial
23. Matrix Income Fund
24. Maxin Income Fund
25. Mint Income Fund
26. Mortgage-Backed Securities Trust
27. Pathfinder Income Fund
28. Penn West Energy Trust
29. Sequoia Oil & Gas Trust
30. Thunder Energy Trust
31. True Energy Trust
32. Vault Energy Trust
33. Vector Energy Fund
34. Yield Plus Income Fund

I have deleted the following plans because the first two have suspended their DRIPs, Viking has merged with Harvest Energy, and the forth has been replaced by Mint Income Fund:
1. Dofasco
2. Terasen
3. Viking Energy Royalty Trust
4. Middlefield High Income Trust

I have also updated the following plans:
1. Harvest Energy - $5,000 per remittance and up to $100,000 aggregate amount of remittances by a unitholder in any calendar month
2. Canetic Resources Trust replaces Acclaim Energy Trust, APF Energy Trust and StarPoint Energy Trust through a succession of mergers.
3. IPC US Income Commercial REIT is now IPC US REIT; added 3% discount
4. Peyto - now $1,000 MIN; no Max
5. Pulse Data Incorporated - MIN reduced from $2,000 to $200

That's it for now. As always, if you see any discrepancies then please post a comment. Don't be discouraged by the fact you now have to enter Word Verfication. I am using this step to cut down the amount of spam the site receives.

Happing DRIPping,
Ken