Starting on the 2nd half of 2023 being July, it's another quarterly "ex-dividend" month for some of Canada's top banks. TD, Royal Bank and BMO come to mind. Their stocks are currently undervalued while the Bank of Canada continues to play their higher interest rate cards. Stopping at a 5% interest rate for 2023? Nobody knows.
The inflation factor is falling and below 4% currently they say but if anything, I'm paying more for goods as the months past so somethings amiss.
Doing some quick math when focusing on dividends, I can bring in more cash dividends by buying an equal amount of certain finance focused, high yield ETFs that pay monthly but adds up to more over a quarter or 3 months than what the Banks payout to shareholders.
However, the trade off is: By buying individual Bank stocks, there are no management fees and dividends will probably continue to increase over the years plus there's also growth to consider with the bank stocks over time.
I say "probably" with the dividends but more than likely to increase. With ETFs there are management fees and depending on the ETF, there are some high yield dividends available for those that have a taste for additional risk.
There are several but BMO's ZWB.TO comes to mind. Hold all the top banks plus ZEB (Equal Weight Banks ETF) with a 7.70% yield and pays a monthly cash dividend.
I prefer to buy individual stocks to hold long term but it all depends on an investor's budget when it comes to the more expensive stocks in the market place.
No comments:
Post a Comment