Canadian Dividend Reinvestment Plans (DRIPs): January 2008
        
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Tuesday, January 29, 2008

S&P/TSX Canadian Dividend Aristocrats Index

In late October of last year, the S&P announced that they were introducing the S&P/TSX Canadian Dividend Aristocrats Index. Similar in nature to the American version, which is entitled the S&P High Yield Dividend Aristocrats, the indices select the most consistent dividend-paying stocks in their respective markets.

However, the criterion used to select them differs widely. Whereas the American list states that companies must have increased dividends every year for at least 25 consecutive years, the Canadian edition only requires that a firm have increased dividends every year for at least seven consecutive years. Conversely, compare this to the Mergent's Dividend Achievers list and the S&P actually requires an extra two years of increased dividends. Does this ensure consistent dividend growth for the corporations on the S&P list in the years to come? Only time will tell.

Even with the much stricter standards, the U.S. list contains 49 companies. The Canadian version only contains 36 as of December 21, 2007. The discrepancy is probably related to the difference in size of the two markets. If Canada used the 25 year criteria then the list would be very short indeed. As it is, both the Mergent’s and S&P lists mirror one another. About half of the companies listed have a Dividend Reinvestment Plan (DRIP) and of those corporations I would say most offer a Share Purchase Plan (SPP) or Optional Cash Purchase Plan (OCP) which allows the user to purchase additional stocks through the company's transfer agent.

The index is weighted heavily (approximately 60%) towards the Financials and the list includes businesses like AGF Management Limited (AGF.B), Manulife Financial (MFC), Royal Bank of Canada (RY) and Sun Life Financial (SLF). The next highest emphasis is Energy and Utilities (about 27%) with AltaGas Income Trust (ALA.UN), Enbridge Incorporated (ENB), Energy Savings Income Fund (SIF.UN) and Imperial Oil (IMO) leading the way.

Although the S&P/TSX Canadian Dividend Aristocrats Index and Mergent's Dividend Achievers list are very similar, the addition of another directory of high dividend paying stocks to the Canadian landscape is a welcome addition for investors looking for solid stocks to invest in.



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Thursday, January 24, 2008

2008 Mergent's Dividend Achievers list

It has been a couple of years since I wrote about the Mergent's Dividend Achievers but in that time the list has grown substantially. The 2008 Canadian version now has 46 constituents, up from the 35 I reported two years ago.

Every year Mergents compiles a list of companies from Canada that have increased their dividends for five consecutive years or more. This is an easy task for most major firms like Banks of Nova Scotia (BNS), Bank of Montreal (BMO), Fortis Incorporated (FTS) and TransCanada Corporation (TRP). However, Income Trusts/Funds and Real Estate Investment Trusts (REITs) have also started popping up on the list. Firms like AltaGas Income Trust (ALA.UN) and Cominar REIT (CUF.UN) have made strong showings of late.

As I stated in my previous post, "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."

The above remains true especially when companies have a high dividend yield with little to no dividend growth. A good example is TransAlta Corporation (TA). The yield sits at a reasonable 3.30% but the company has not raised the dividend since 1999! For an excellent explanation as to why this can be a problem, please see point #9 of Tom Connolly's "Investing Yourself" document. In fact, the whole article is a wonderful primer on DIY investing and I read it often!


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Friday, January 18, 2008

Another New Year, Another New Update!!

I have made some massive changes to the site after being inactive for a while. Please see the lists below for full details.

As well, thank you everyone for patience. I hope that the time between updates will not be so long in future.

I have added the following new plans:
1. Builders Energy Services Trust (BET.UN)
2. Charter REIT (CRH.UN)
3. Deepwell Energy Services Trust (DWL.UN)
4. Enerflex Systems Income Fund (EFX.UN)
5. Energy Savings Income Fund (SIF.UN) – NOTE: 500 shares needed to enroll
6. EnerVest Energy & Oil Sands Total Return Trust (EOS.UN)
7. Extendicare REIT (EXE.UN)
8. Fairway Investment Grade Income Fund (FGF.UN)
9. Fording Canadian Coal Trust (FDG.UN)
10. Huntingdon REIT (HNT.UN)
11. InStorage REIT (IS.UN)
12. Killam Properties (KMP)
13. Long Reserve Life Resource Fund (LRF.UN)
14. Macquarie Power & Infrastructure Fund (MPT.UN)
15. Medical Facilities Corporation (DR.UN)
16. Oil Sands Sector Fund (OSF.UN)
17. Precious Metals and Mining Trust (MMP.UN)
18. Sentry Select China Fund (CHZ.UN)
19. Shaw Communications (SJR.B)
20. Strategic Energy Fund (SEF.UN)
21. Superior Plus Income Fund (SPF.UN)
22. Top 10 Canadian Financial Trust (TCT.UN)
23. Uranium Focused Energy Fund (UF.UN)
24. Westshore Terminals Income Fund (WTE.UN)


I have updated the following plans:
1. Alcan Aluminium Incorporated- firm taken private by Rio Tinto
2. Amalgamated Partnership Income Units - DRIP suspended
3. Bonnett's Energy Services Trust - DRIP suspended
4. Canetic Resources Trust - merged into PrimeWest Energy Trust
5. Cominar Nihon REIT – changed name to Cominar REIT
6. Daylight Energy Trust - name changed to Daylight Resources Trust; Minimum amount changed to $1,000 from $2,000 while the maximum changed to $100,000 per month instead of $100,000 per year
7. Enbridge Incorporated (ENB) - 2% discount added
8. Ipsco Incorporated - firm taken private by SSAB Canada Inc.
9. MCAP Incorporated - name changed to MCAN Mortgage Corporation (MKP)
10. MDS Incorporated - DRIP suspended
11. PrimeWest Energy Trust - firm taken private by the Abu Dhabi National Energy Company, also known as TAQA

That's it for now. As always, if you see any discrepancies please post a comment.

Happing DRIPping,
Ken


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List of Canadian DRIPs & SPPs

Company

Symbol

DRIP? SPP? Discount? Minimum Maximum
Aberdeen Asia-Pacific Income Investment Company Limited FAP Y Y N $100/Month $20,000/Year
ACTIVEnergy Income Fund AEU.UN Y Y 5% $100 -
AGF Management Limited AGF.B Y N N N/A N/A
Agnico Eagle Mines Limited AEM Y Y 5% US$100 US$20,000/Year
Allied Properties REIT AP.UN Y N 5% N/A N/A
AltaGas Ltd. ALA Y Y 5% $1,000 $100,000/Month
ARC Resources Ltd. ARX Y Y 5% $500 $3,000/Month
Artis REIT AX.UN Y Y 4% $1,000 $10,000
Bank of Montreal BMO Y Y N - $40,000/Year
Bank of Montreal Exchange-Traded Funds (ETFs) - Y N N N/A N/A
Bank of Nova Scotia BNS Y Y 2% $100/Month $20,000/Year
Baytex Energy Corp. BTE Y N 5% N/A N/A
BCE Inc. BCE Y Y N - $20,000/Year
Bell Aliant Inc. BA Y Y N - $3,400/Month
Brompton Oil & Gas Income Fund OGF.UN Y Y 5% - -
Brompton VIP Income Fund VIP.UN Y Y 5% - $20,000/Year
Brookfield Asset Management Inc. BAM.A Y N N N/A N/A
Brookfield Office Properties Canada BOX.UN Y N N N/A N/A
Brookfield Properties Corp. BPO Y N N N/A N/A
CAE Inc. CAE Y N N N/A N/A
Calloway REIT CWT.UN Y N 3% N/A N/A
Canadian Apartment Properties REIT CAR.UN Y N 5% N/A N/A
Canadian General Investments, Limited CGI Y Y N $100/Quarter $5,000/Quarter
Canadian REIT REF.UN Y Y 4% $250/Month $25,000/Year
Canadian Tire Corporation CTC Y N N N/A N/A
Canadian Western Bank CWB Y N N N/A N/A
Canexus Corporation CUS Y N 5% N/A N/A
Capstone Infrastructure Corporation CSE Y N N N/A N/A
Caribbean Utilities Company, Ltd. CUP.U Y N N N/A N/A
Cenovus Energy Inc. CVE Y N N N/A N/A
Cervus Equipment Corporation CVL Y N 5% N/A N/A
Chartwell Seniors Housing REIT CSH.UN Y N 3% N/A N/A
Churchill Corporation CUQ Y N 5% N/A N/A
CIBC CM Y Y 2% $100 $50,000/Year
Citadel Income Fund CTF.UN Y N N N/A N/A
Claymore Exchange-Traded Funds (ETFs) - Y N N N/A N/A
ClubLink Enterprises Limited CLK Y N 5% N/A N/A
Cominar REIT CUF.UN Y N 5% N/A N/A
COMPASS Income Fund CMZ.UN Y Y 5% $100 -
Corus Entertainment CJR.B Y N N N/A N/A
Crescent Point Energy Corp. CPG Y N 5% N/A N/A
Daylight Energy Ltd. DAY Y Y 5% $1,000 $100,000/Month
DDJ High Yield Fund HYB.UN Y N 5% N/A N/A
Dundee REIT D.UN Y Y 4% $1,000 $250,000/Year
Dundee International REIT DI.UN Y Y 4% $1,000 $250,000/Year
Eagle Energy Trust EGL.UN Y N 5% N/A N/A
Emera Inc. EMA Y Y 5% $25/Quarter $5,000/Quarter
Enbridge Inc. ENB Y Y 2% - $5,000/Quarter
Enbridge Income Fund Holdings Inc. ENF Y Y N $100/Month $1,000/Month
EnCana Corporation ECA Y N N N/A N/A
Energy Income Fund ENI.UN Y N N N/A N/A
Enerplus Corporation ERF Y Y N N/A N/A
EnerVest Diversified Income Trust EIT.UN Y Y N - $1,000/Month
EnerVest Energy & Oil Sands Total Return Trust EOS.UN Y Y N $100 $1,000/Month
Equitable Group Inc. ETC Y N N N/A N/A
Exchange Income Corporation EIF Y Y 3% $100 $10,000/Month
Extendicare REIT EXE.UN Y N 3% N/A N/A
Firm Capital Mortgage Investment FC Y Y N $250/Month $12,000/Year
Flaherty & Crumrine Investment Grade Fixed Income Fund FFI.UN Y Y 5% - -
Fortis Inc. FTS Y Y 2% $100/Quarter $30,000/Year
Freehold Royalties Ltd. FRU Y N N N/A N/A
Gibson Energy Inc. GEI Y N 3% N/A N/A
GMIncome & Growth Fund GMF.UN Y Y 5% $100 -
H&R REIT HR.UN Y Y 3% $250/Month $13,500/Year
Homburg Canada REIT HCR.UN Y N 3% N/A N/A
HOMEQ Corporation HEQ Y N 4% N/A N/A
Horizon Alpha Pro ETFs - Y N N N/A N/A
Husky Energy HSE Y N N N/A N/A
Imperial Oil Limited IMO Y Y N $50/Quarter $5,000/Quarter
Income Financial Trust INC.UN Y N N N/A N/A
INDEXPLUS Dividend Fund IDF.UN Y Y 5% $100 -
INDEXPLUS Income Fund IDX.UN Y Y 5% $100 -
Intact Financial Corporation IFC Y N N N/A N/A
Inter Pipeline Fund IPL.UN Y N 5% N/A N/A
InterRent REIT IIP.UN Y Y 4% $250 -
Just Energy Group JE Y Y 2% $500/Month $100,000/Year
Keyera Corp. KEY Y N 3% N/A N/A
Killam Properties Inc. KMP Y N 3% N/A N/A
Lanesborough REIT LRT.UN Y Y 4% $1,000 $10,000/Month
Liquor Stores N.A. Ltd. LIQ Y N 3% N/A N/A
Manitoba Telecom Services Inc. MBT Y Y 3% $100 $20,000/Year
Manulife Financial Corporation MFC Y Y 3% $100/Quarterly $250,000/Year
MCAN Mortgage Corporation MKP Y N N N/A N/A
Medical Facilities Corporation DR Y N N N/A N/A
MINT Income Fund MID.UN Y Y N $100 -
Morguard Corporation MRC Y N N N/A N/A
Morguard REIT MRT.UN Y N N N/A N/A
MOSAID Technologies MSD Y N N N/A N/A
Mulvihill Premier Canadian Income Fund PCU.UN Y N 5% N/A N/A
Mulvihill Top 10 Canadian Financial Trust TCT.UN Y N 5% N/A N/A
NAL Energy Corp. NAE Y Y 5% $1,000 $5,000/Month
National Bank of Canada NA Y Y N $500 $5,000/Quarter
Nexen Inc. NXY Y N 5% N/A N/A
Northland Power Inc. NPI Y N N N/A N/A
NorthWest Healthcare Properties REIT NWH.UN Y N 3% N/A N/A
Olympia Financial Group Inc. OLY-X Y Y N - -
Onex Corporation OCX Y N N N/A N/A
Parkland Fuel Corporation PKI Y N N N/A N/A
Partners REIT PAR.UN Y Y 3% $1,000 $12,000/Year
PATHFINDER Convertible Debenture Fund PCD.UN Y Y 5% $100 -
Pengrowth Energy Corporation PGF Y Y 5% - $1,000/Month
Penn West Exploration PWT Y Y 5% $500 $5,000
Phoenix Technology Services PHX Y N 5% N/A N/A
Plazacorp Retail Properties Limited PLZ-X Y N 3% N/A N/A
Potash Corporation POT Y N N N/A N/A
Precious Metals and Mining Trust MMP.UN Y N N N/A N/A
Primaris Retail REIT PMZ.UN Y N 3% N/A N/A
Progress Energy Resources Corp. PRQ Y N 5% N/A N/A
Provident Energy Ltd. PVE Y Y 5% $1,000 $100,000/Month
REIT INDEXPLUS Income Fund IDR.UN Y Y 5% $100 -
Retrocom Mid-Market REIT RMM.UN Y N 4% N/A N/A
RioCan REIT REI.UN Y Y 3.1% $250/Month $25,000/Year
Rogers Communications Inc. RCI.B Y N N N/A N/A
Royal Bank of Canada RY Y N N N/A N/A
Senior Gold Producers Income Corp GPC Y Y 5% - $20,000/Year
Shaw Communications Inc. SJR.B Y N N N/A N/A
Skylon Growth & Income Trust SKG.UN Y N N N/A N/A
Student Transportation of America Ltd. STB Y N 3% N/A N/A
Suncor Energy Inc. SU Y Y N $100 $5,000/Quarter
Sun Life Financial SLF Y Y 2% $100/Quarter $50,000/Year
Superior Plus Corp. SPB Y Y 5% $1,000/Month $20,000/Year
Telus Corporation T Y Y N $100/Month $20,000/Year
Thomson Reuters Corporation TRI Y N N N/A N/A
Timbercreek Mortgage Investment Corporation TMC Y N 5% N/A N/A
Tim Hortons THI Y Y N $25 $250,000/Year
Toronto-Dominion Bank TD Y N 1% N/A N/A
Torstar Corporation TS.B Y N N N/A N/A
TransAlta Corporation TA Y Y 3% - $5,000/Quarter
TransCanada Corporation TRP Y Y N $50/Quarter $10,000/Quarter
TransGlobe REIT TGA.UN Y N 3% N/A N/A
Triax Diversified High-Yield Trust TRH.UN Y N N N/A N/A
Troy Resources NL TRY Y N 5% N/A N/A
Valener Inc. VNR Y N 5% N/A N/A
Veresen Inc. VSN Y N 5% N/A N/A
Vermilion Energy Trust VET Y N 5% N/A N/A
Whiterock REIT WRK.UN Y Y 4% $250 -
Yellow Media Inc. YLO Y N 5% N/A N/A
YIELDPLUS Income Fund YP.UN Y Y 5% $100 -
Zargon Oil & Gas Ltd. ZAR Y N 5% N/A N/A

LEGEND: Company - name of company offering a Dividend Reinvestment Plan (DRIP); Company Hyperlink - click the link to view the plan details;
Symbol - company's stock ticker symbol; Symbol Hyperlink - click the link to view the current Globe Investor stock quote; DRIP - does the company have a DRIP?;
SPP - does the company offer a Share Purchase Plan (SPP) or Optional Cash Purchase Plan (OCP) which allows the user to purchase additional shares/units through the company's transfer agent?;
Discount - does the company offer a discount on the price of additional shares/units purchased through an SPP/OCP or through dividend reinvestment?;
Minimum - the minimum amount per SPP/OCP; Maximum - the maximum amount per SPP/OCP; Highlighted Row - company has an SPP/OCP