Wealth-Builder Model Portfolio (CDN) – Quarterly Review – As of January 31, 2025
Posted by BM on February 28, 2025
This real-money portfolio is designed to demonstrate the power of dividend growth investing—but before we dive in, let’s talk about what we know and everyone else misses.
Most investors obsess over short-term capital gains. We don’t.
“I measure our progress primarily on the basis of the income we are collecting and the growth of that income through dividend increases.”
- Josh Peters
That’s our philosophy. Growing dividends drive long-term returns. As dividends rise, so do stock prices and portfolio values. The key? Process and Patience.
Don’t just take our word for it—see the results yourself.
The Wealth-Builder Model Portfolio (CDN) is a real-money portfolio designed to demonstrate dividend growth investing in action.
This portfolio was launched on May 1, 2022, with an initial capital injection of $100,000 (invested over four years), supplemented by $12,000 in annual contributions and full dividend reinvestment. Our 10-year goal is to generate approximately $1,000 in monthly dividend income by our tenth anniversary.
SUMMARY
We now receive dividend income from 19 companies spanning 8 sectors of the Canadian economy.
Eleven companies raised dividends this quarter, reinforcing our commitment to growing income.
We added two new positions and increased our stake in two existing holdings, strengthening our portfolio.
Dividend income surged 18.3% from last quarter, totaling $950.91 for the quarter and $3,810 in annualized income.
Portfolio performance: The year-to-date total return (including dividends) is 5.04%, and since its inception (May 2022), the portfolio has delivered an annualized total return of 10.80%.
Background
Dividend growth investing is a long-term investment strategy that involves selecting quality stocks with a history of consistently increasing dividends and holding them for the long term.
The Magic Pants Wealth-Builder Model Portfolio (CDN) is a real-money, real-time portfolio demonstrating the principles and practices of dividend growth investing. The portfolio was launched on May 1, 2022, and has been managed in real-time since. Its primary goal is to generate a steadily increasing stream of dividends paid by quality Canadian companies. The secondary goal is to build a portfolio that generates above-average total returns over the long term (5-10 years). When I speak of average, I mean the index. In Canada, our objective is to beat the TSX Composite Index in total returns over this period.
The point here is that dividend growth investing and maximizing total returns aren't mutually exclusive.
All the decisions to buy, hold, and sell securities are real decisions about handling money. The portfolio is intended to serve as a blueprint for constructing a dividend growth portfolio, and as a living example of how dividend growth investing works.
Quarterly Portfolio Review
One of our practices is to give the Magic Pants Wealth-Builder Model Portfolio (CDN) a checkup four times yearly (the end of July, October, January, and April). The basic questions are:
How is the portfolio doing?
Is it tracking towards its goal?
How is each position doing?
Should changes be made?
To provide accountability, transparency, and trust in our process, we ‘timestamp’ all our trades. Each quarter, we show each purchase transaction to date to see how we are doing and how a growing dividend affects price. We don’t hide our history. When we’re wrong, it’s right there for all to see – every win, loss, and tie.
Let’s dive in!
