The Money Muddle

Week 12 - Preview

noreply@blogger.com (MoneyMuddle) — Mon, 29 Mar 2010 16:16:00 +0000

More Gains. Portfolio gained +1.59% (CAD +2.70%)this week.
Changes:
In the CAD side of the portfolio I took a position in Garda World Security Services (GW.TO). Garda World Security is a midsize security based in Montreal, Canada, with an upside potential. The company has had a single bad year (2008, -98%), but quickly recovering, through a good financing and restructuring, to have a return of more than +1000% since then.
In the USD side, I finally closed my position in TNH recording a loss of -22.61% on the position. I still believe that TNH is a good "buy and hold" stock, but unfortunately the company has been caught into the struggle of the takeover of its parent company Terra Industries TRA by CF Industries (CF), and in the short term it will be holding a sizable amount of cash that could be used otherwise.
Using the cash from the recent exits, I took positions in Wells Fargo WFC and Starbucks SBUX.
Performance:
The Financials moved higher this week with C jumping +10.80% and BAC moving higher by +7.70%.
In Canadian energy, FM.TO gained +4.14% and TCK-B.TO +5.36%.
All other positions remained in the +/- 1% area, with the exceptions of VALE which moved higher by +5.09% recovering most of the past weeks loses, and BVF.TO which gained +3.60% for the week.
The YTD performance at the end of the week is +13.28% (+11.14% in CAD).

Week 11 - Preview

noreply@blogger.com (MoneyMuddle) — Sun, 21 Mar 2010 22:05:00 +0000

Sideways. Portfolio gained +2.83% by midweek and lost it all to land right back were it started on Monday.
I doubled my position at TBSI early on the week, and the move paid off since TBSI jumped +9.00% by the end of the week. I also closed my position in NAT. I still believe strongly that NAT is a good play for the long run, but in the past few months it has moved very little and it is simply using cash that could be better used in other opportunities.
TNH continues its loses (-9.85% this week) and at this point I am looking to see where the bottom it will be. GMCR gained slightly (.87%), closing at $93.90.
The Financials moved very little in the week and so were the Utilities and Resources.
In Canadian energy I increased by 200% my position in FM.TO, since I believe it has some room to grow, and FM.TO ended up +2.17% for the week. A good performer was also BTE-UN.TO that closed +3.34% on the week. The other positions were mainly in the positive side but with very small gains. The exception is PVE-UN.TO which closed the week on a loss of -9.36%.
The YTD performance at the end of the week is +11.46% (+8.26% in CAD).

Week 10 - Preview

noreply@blogger.com (MoneyMuddle) — Sat, 13 Mar 2010 21:51:00 +0000

What a week! Markets jumped further up this week, recording a gain of +5.98% (CAD +4.64%) for the portfolio.
The highlight of the week was the jump of C (+12.15%) and the LEAPS calls that I have on it. I would have hoped that the rally on C would continue next week, but unfortunately it ended with a sell-off on Friday losing more than 5% for the day.
The Financials bounced upwards (MS +4.36%, C +2.94%) following the major indexes (SPY +3.16%). Shipping again ended up for the week with TBSI (+5.64%), FRO (+8.12%), and NAT +4.07%). Utilities and Resources were mixed: VALE (-2.56%), VLO (+4.34%), TCK-B.TO (-1.82%), FM.TO (+2.33%).
TNH recovered some of the losses of last wee, gaining +4.87%, and GMCR continued its climb towards the $100, closing at $92.65 (+4.72%).
The Canadian dollar continues its climb towards the parity with USD (closing and Friday at USD 0.9827), affecting so the USD side of the portfolio or the 67% of it. I expect the CAD reach parity on early summer and will continue through it before the Bank of Canada making a move. In order to hedge against this, I further raised the CAD allocation by taking positions in the following Canadian assets: PVE-UN.TO, PGF-UN.TO, PWT-UN.TO, BVF.TO.
The YTD performance at the end of the week is +11.26% (+8.15 in CAD).

Week 9 - Preview

noreply@blogger.com (MoneyMuddle) — Sat, 06 Mar 2010 23:18:00 +0000

Great week. Markets moved upwards on good news from jobs report, with a bounce of +5.14 (CAD +2.85%).
Early on the week I took a position on BAC. The Financials bounced upwards (MS +4.36%, C +2.94%) following the major indexes (SPY +3.16%).
Shipping continued the move upward with TBSI (+9.08%) and FRO (+5.12%), while NAT having very little action, closing the week with a minor loss of -1.13%.
Utilities and Resources bounced back, trimming most of the previous losses VALE (+11.08%), VLO (+10.69%), TCK-B.TO (+8.10%), FM.TO (+4.82%).
TNH had a horrible week, recording a drop of -12.58%. This was due to the news on a hostile takeover from CF Industries on Terra Industries to which TNH is a subsidiary.
The YTD performance at the end of the week is +5.30% (+3.47 in CAD).

Portfolio Summary - February 2010

noreply@blogger.com (MoneyMuddle) — Mon, 01 Mar 2010 00:47:00 +0000

Name	Price ?	Cost ?	Weight (%) ?	Gain/Loss (%) ?	Performance (%) ?
YTD Portfolio Performance				USD$ 0.16%	CAD$ 0.62%
MS call Jan 11	$ 13.15	$5.91	2.07%	122.52%	-1.13%
NAT	$ 29.06	$29.35	4.57%	-0.99%	-2.06%
TNH	$ 100.35	$130.17	4.73%	-22.91%	-0.89%
FRO	$ 26.95	$26.08	6.36%	3.33%	-10.35%
MS	$ 28.18	$26.60	4.43%	5.94%	5.23%
C call Jan 12	$ 1.12	$1.88	3.52%	-40.27%	1.82%
TBSI	$ 5.95	$9.38	2.81%	-36.56%	-1.16%
GMCR	$ 84.39	$32.21	9.95%	162.03%	-0.51%
C	$ 3.40	$2.76	5.35%	23.19%	2.41%
SPY	$ 110.74	$106.17	5.23%	4.31%	3.12%
SPY call Jan 2011	$ 11.26	$12.97	5.31%	-13.22%	8.27%
C call Jan 11	$ 1.36	$1.38	2.14%	-1.09%	3.03%
VLO	$ 17.52	$18.73	2.76%	-6.46%	-4.89%
VALE	$ 27.86	$31.18	3.07%	-10.65%	8.03%
CMO	$ 12.44	$13.75	1.96%	-9.53%	-6.33%
HTS	$ 25.97	$27.75	2.04%	-6.41%	-5.18%
MOT	$ 6.76	$6.51	4.25%	3.76%	9.92%
FM.TO	$ 82.00	$91.50	1.29%	-10.38%	5.74%
TCK-B.TO	$ 38.70	$6.40	12.42%	504.99%	10.54%
BTE-UN.TO	$ 33.55	$30.45	5.28%	10.18%	10.00%
CDZ.TO	$ 18.65	$18.89	2.93%	-1.27%	2.53%
CHB.TO	$ 19.51	$20.07	3.07%	-2.79%	-0.46%
RY.TO	$ 56.81	$55.30	4.47%	2.73%	8.66%

Week 8 - Preview

noreply@blogger.com (MoneyMuddle) — Sat, 27 Feb 2010 22:54:00 +0000

Moving sideways. Positions just traded sideways for the rest of the week, resulting in a slight drop (USD -1.44%, CAD -0.33%), due mainly to an oscillating USD.
Very little movement to be recorded. Shipping moved heavily up and down with TBSI dropping -12% between Tue and Wed and then gaining back to close at where it started (+0.33%), and FRO reaching +4.07% on Tue and losing all ground to close at -2.14%.
Financials also traded sideways, with the exception of MS which added +2.81% this week. However financials seem to be showing signs of a more stable upward trend. Could see them gaining some more ground in the weeks ahead.
Utilities were poor performers (VALE -3.33%, VLO -2.06%).
The YTD performance at the end of the week is +0.16% (+0.62 in CAD).

Week 7 - Preview

noreply@blogger.com (MoneyMuddle) — Sat, 20 Feb 2010 20:43:00 +0000

Bouncing back. 4% were added on the plus side this week (USD +3.99%, CAD +2.97%).
The portfolio continues to gain some ground. Main factors are the shipping [FRO (+5.80%), TBSI (+6.61%)] and energy [FM.TO (+6.85%), TCK-B.TO (+5.04%)] positions, as well as the US dollar gaining against most of the currencies. C (+7.02%) and VALE (+7.55%) pared some of the previous losses.
All other positions just traded sideways for the rest of the week.
The YTD performance at the end of the week is +1.609% (+0.97 in CAD). Finally in positive territory.

Week 6 - Review

noreply@blogger.com (MoneyMuddle) — Mon, 15 Feb 2010 02:10:00 +0000

Slightly up. Markets traded themselves sideways through a zig-zag fashion of 1-2%.
The portfolio gained back some of the losses of last week with a +2.84% climb. Taking that position on MOT two weeks ago proved valuable as it closed the week with a +11.72% gain. Energy positions improved with FM.TO (+7.05%), TCK-B.TO (+8.92%) and BTE-UN.TO (+7.42%) gaining back some of the losses.
Shipping remained sluggish, while Financials dropped, mostly with HTS (-8.78%) and CMO (-4.84%).
The YTD performance at the end of the week is -2.39% (-2.02 in CAD).

Week 5 - Review

noreply@blogger.com (MoneyMuddle) — Sat, 06 Feb 2010 22:56:00 +0000

Sliding downward continues. Markets got hit very hard this week, mainly on news of weakness from the Eurozone and domestic unemployment numbers.
The portfolio dropped an extra -2.41% this week. The shipping and energy stocks were hit hard with FRO (-12.14), TBSI (-10.38), FM.TO (-7.31), TCK-B.TO (-3.25), making up for most of the losses.
The YTD performance at the end of the week is -5.26% (-2.79 in CAD).

Portfolio Summary - January 2010

noreply@blogger.com (MoneyMuddle) — Mon, 01 Feb 2010 22:34:00 +0000

Name	Price ?	Cost ?	Weight (%) ?	Gain/Loss (%) ?	Performance (%) ?
YTD Portfolio Performance				USD$ -5.26%	CAD$ -2.79%
MS call Jan 11	$ 13.30	$ 5.91	2.14%	125.06%	-10.50%
NAT	$ 29.67	$ 29.35	4.78%	1.09%	-1.10%
TNH	$ 104.08	$ 101.25	4.90%	-22.22%	-2.72%
FRO	$ 30.06	$ 26.08	7.27%	15.26%	10.03%
MS	$ 26.78	$ 26.60	4.32%	0.68%	-9.53%
C call Jan 12	$ 1.10	$ 1.88	3.55%	-41.33%	-5.98%
TBSI	$ 6.02	$ 9.38	2.91%	-35.82%	-18.10%
GMCR	$ 84.82	$ 32.21	10.25%	163.36%	4.11%
C	$ 3.32	$ 2.76	5.32%	20.29%	0.30%
SPY	$ 107.39	$ 106.17	5.19%	1.15%	-3.63%
SPY call Jan 2011	$ 10.40	$ 12.97	5.03%	-19.85%	-26.24%
C call Jan 11	$ 1.32	$ 1.38	2.13%	-4.00%	-7.69%
VLO	$ 18.42	$ 18.73	2.97%	-1.66%	-1.66%
VALE	$ 25.79	$ 31.18	2.91%	-17.29%	-17.29%
CMO	$ 13.28	$ 13.75	2.14%	-3.42%	-3.42%
HTS	$ 27.39	$ 27.75	2.21%	-1.30%	-1.30%
MOT	$ 6.15	$ 6.51	3.97%	-5.60%	-5.60%
FM.TO	$ 77.55	$ 91.50	1.25%	-15.24%	-3.38%
TCK-B.TO	$ 35.01	$ 6.40	11.51%	447.30%	-4.92%
BTE-UN.TO	$ 30.50	$ 30.45	4.92%	0.17%	0.17%
CDZ.TO	$ 18.19	$ 18.89	2.93%	-3.70%	-3.70%
CHB.TO	$ 19.60	$ 20.07	3.16%	-2.34%	-2.34%
RY.TO	$ 52.28	$ 55.28	4.21%	-5.46%	-5.46%

Week 4 - Review

noreply@blogger.com (MoneyMuddle) — Sun, 31 Jan 2010 22:25:00 +0000

Between a rock and a hard place. This was the state of duress that was the portfolio and the overall market last week.
The rock were the market jitters coming from the administration regarding the future of the big banks, and the hard place is China moving towards cooling its overheated economy.
The portfolio dropped an extra -2.33% this week, adding to the losses of last week. The most losers were VALE, which fell hard after the China announcement, TBSI, and MOT, which was added this week but that I did not get it low enough. The better performers were GMCR, that posted yet again excellent earnings, and C.
The YTD performance at the end of the week is -2.85% (-0.82 in CAD).

Week 3 - Review

noreply@blogger.com (MoneyMuddle) — Sun, 24 Jan 2010 21:31:00 +0000

Yes We Can!... We heard it. But maybe you shouldn't. The bloodbath of last week hopefully took a break with the weekend, and hopefully will not spill over into next week.
The big (and profitable) banks were able to weather the recession, but it seems they will not be able to survive the wrath of the Administration. Nevertheless, the automotive industry and their financial subsidiaries, that have managed to survive since the '70s with government support, have secured the majority of the TARP funds (with the certainty of never giving it back) and it seems they will be able to survive another 10 years or so.
The portfolio dropped significantly, while exposed heavily in financials. After the freefall of the 2nd half of the week, here are the final numbers: overall performance had dropped about -8%, landing the portfolio in negative territory for the year of -0.52%. Thankfully, the USD dollar gained against the CAD dollar, having the conversion of the portfolio into local currency at +0.54%. The YTD performance at the end of the week is -0.52%. What a week, thank God it is over!

Week 2 - Review

noreply@blogger.com (MoneyMuddle) — Mon, 18 Jan 2010 02:48:00 +0000

The goal for this week was to increase holdings in Canadian securities. And did just that! Portfolio now has a comfortable 31% slice in Canadian securities. It feels like the move came too late, knowing that in 2009 the Canadian holdings brought home a whopping 171% vs. 18% of the US holdings. But oh well!
Since in mid-2009 I took on a mortgage to cover some of the cost of the new duplex, I needed a strategy to benefit from this event. In Canada mortgage are not tax deductible, but we have the Smith Manoeuvre (for those wanting to know more about this there is a detailed and well-written explanation at the Million Dollar Journey). Therefore, most of the Canadian cash comes from my HELOC (Home Equity Line Of Credit), and it will be placed in relatively secure and dividend-producing securities. The latest arrival in the Canadian portfolio are: Royal Bank of Canada (RY.TO), Baytex Energy Trust (BTE.UN.TO), and two ETFs, the newly created Claymore's S&P/TSX Canadian Dividend Fund (CDZ.TO) and Claymore's High Yield Bonds Fund (CHB.TO).
The overall performance had dropped of -2.5%, mainly due to the sell-off on Friday. The YTD performance at the end of the week is +7.14%.

Week 1 - Review

noreply@blogger.com (MoneyMuddle) — Sat, 09 Jan 2010 03:36:00 +0000

The first week of the year ended with results I could not even dreamed of. The portfolio jumped +9.74% (8.15% in local currency Cad$) in the first 5 days of the year and I had hoped to have a 10% gain for the entire 2010. Portfolio funds got a 30% boost this week with a significant cash infusion. The main reason being a balancing the geographic spread with Canadian and European securities. Canadian section increased by 100% and now represents about 30% of the portfolio. (An European holding will start taking shape in the forthcoming weeks). Portfolio is divided in three sectors (Finance/Banking, Manufacturing/Resources and Transportation/Shipping), therefore it demands more diversification. But, been thinking a bit more about it, and I am of the conviction that, for different reasons, these three sectors will outperform the market as a whole in 2010. So I decided against diluting the concentrations. Another move I voted against this week, was some reasoning about currency hedging (portfolio is mainly in USD while local currency is CAD). Holding securities in USD has resulted a drop of -15% in overall portfolio performance. I remain of the hope to recover some of these loses betting in a 2010 relative strength of USD towards major currencies.

In Review: Year 2009

noreply@blogger.com (MoneyMuddle) — Mon, 04 Jan 2010 21:44:00 +0000

Fresh Start: The end of 2008 came with mixed results and a bundle of uncertainties. After leaving my position at an investment bank at the fall of 2008, I settled for another one that came with a 10% increase in salary and another 10% year-end bonus. In between jobs, Mrs. Muddle and I decided to take a 2-week vacation to beautiful Iceland (this is before the island’s economy collapsing). The vacation shaved off about 8% of the Muddle’s 2008 gross income but left us with beautiful memories. As for everyone else, the investments results of 2008 were disastrous. In a move of being tax-aware I liquidated my positions in Dec 2008 taking a sizeable loss. The loss was used to offset taxation on the year-end bonus. Therefore, I used the first few weeks of 2009 rebuilding the portfolio, and spotting opportunities in the wreckage of 2008 where to land my now-sizeable chunk of change.
Retooling: I needed to make an upgrade to the se of tools and methods I used to track my finances. I moved from tracking my net worth into pieces of paper into some nice templates using EditGrid, I upgraded from not-tracking-expenses to tracking everything with Yodlee, and added thinkorswim to the list of the trading companies I use.
New Digs: After a 14-month quest for the perfect abode, the Muddles finally settle for a magnificent duplex in a sought-after neighborhood in the heart of Montreal. The process was quite long and at times stressful, with Mrs. Muddle pulling the heavy weight (hunting the various neighborhoods, dealing with real estate agents, etc). Finding the perfect home is an eye-opening process, taking that initial lightbulb-like idea of "we need a new home", carefully managing through the common and uncommon expectations and financial reality, and gracefully landing it to fit your desires without breaking you future financial plans. Here are some of the financial reasons why we decided it is time for a new home.
New Portfolio: The wreckage of 2008 it was a major blow to the portfolio (mine and everyone else’s), but also induced a decent size of realism into my financial expectations. However, while stocks in my portfolio looked more like carcasses floating in the river, some other (unintentional) financial moves had made life bearable. First, at the end of 2008 I still had a job. While usually a no-news, in 2008 this was a darn-good hell of a news. So income from work was flowing in uninterrupted. Also, inline with the rule where every year I take about 20% of all profits from volatile investments and place it in rather safer investment, by mid-2008 all debt as well the mortgage on the condo it was all paid off, reducing our expenses and allowing for more liquidity to be invested. With 2008 ending and 2009 starting, the main goal of the new portfolio and its strategic placements were to offset the losses of 2008. Towards the end of Q1, I had finally overcome the losses of 2008. This was mainly due to the strategy of looking for carcasses floating on the Wall Street river for the ones that still showed signs of life and potentially an increased chance of survival (an increased position in Citigroup, [average cost= 1.25, average sale = 4.50], and TCK-B.TO [average cost= 5.25, average sale = 28.50] filled some of the hole. While for the first two quarters of 2009 the performance was pretty flat, by end of Q3 I was enjoying a 28% jump that continued through the year end closing at +28.62%. Factoring in the further weakening of the US dollar it only accounts for a +13.61% increase in local currency (Canadian dollar).
No Vacations: It has been a busy year. Job has been tough and at times stressful. And with the settling into the new house in late spring, most of the summer was spent in fixing things around to our taste and exploring the new neighborhood. Also, still dealing with the nightmares of the 2008 portfolio losses and those upfront fees (real estate, moving costs and taxes) that need to be coughed up when you buy a new house, I was reluctant to embark into an expensive exotic exception. This year we decided to live with the memories of the years past vacations and settle for a 1-week getaway to Mt.Tremblant, and whenever possible, time-off-from-work recovering at home from any hard work put into the new house.
New job... again: While financially rewarding, the job I got in 2008 did not pay off in many other ways. Like in any other investments, there is a cost involved with any job you take. The "cost of working" (vs. "the reward of working"), would include things like time invested, overtime, stressful time at work or "combat work", expenses involved in getting to work, the drop in quality of life (while comparing it with another position or prior positions), how the experience would enhance your career (and resume), etc., and sometimes after calculating "cost vs. reward" you realize that it is just not worth it. Well, in September I landed a new consulting position. The new job came with a 5% increase in base annual salary, but in gross with a -5% decrease because I lost the year-end bonus. In the end, it is all good, as the cost/reward ratio is higher, stress level is lower, and there would be more potential for career advancement.

Portfolio Summary - Year End 2009

noreply@blogger.com (MoneyMuddle) — Fri, 01 Jan 2010 21:56:00 +0000

Name	Price ?	Cost ?	Break (%) ?	Gain/Loss (%) ?	Performance (%) ?
YTD Portfolio Performance				USD$ 28.62%	CAD$ 14.91%
VWDAC	$ 14.86	$ 5.91	3.23%	151.46%	0%
NAT	$ 30.00	$ 29.35	6.53%	2.21%	0%
TNH	$ 104.08	$ 130.17	6.80%	-20.04%	0%
FRO	$ 27.32	$ 26.08	8.92%	4.75%	0%
MS	$ 29.60	$ 26.60	6.44%	11.28%	0%
VRNAY	$ 1.17	$ 1.88	5.09%	-37.60%	0%
TBSI	$ 7.35	$ 9.38	4.80%	-21.64%	0%
GMCR	$ 81.47	$ 32.21	13.30%	152.96%	0%
C	$ 3.31	$ 2.76	7.20%	19.93%	0%
SPY	$ 111.44	$ 106.17	7.28%	4.97%	0%
OBVLF	$ 14.10	$ 12.97	9.21%	8.67%	0%
WRVAZ	$ 1.43	$ 1.38	3.11%	4.00%	0%
FM.TO	$ 80.26	$ 91.50	1.75%	-12.28%	0%
TCK-B.TO	$ 36.82	$ 6.40	16.35%	475.60%	0%

Happy New Year

noreply@blogger.com (MoneyMuddle) — Fri, 01 Jan 2010 13:59:00 +0000

Happy New Year