I Beat the TSX, by 10%

Back in October I adopted the Beating the TSX (BTSX) system as the heart of the stock portion of my portfolio. The system is very simple:

  • Start with the list of all companies in the TSX60
  • Discard any that do not have a long history of paying a consistent dividend (e.g. former income trusts)
  • Select the ten stocks with the highest dividend
  • Repeat annually

So, how did it do in 2011?

Stock 31-Dec-10 Closing Price 30-Dec-11 Closing Price Price Gain Dividend Dividend Yield Total Return
BMO $57.48 $55.88 -2.78% $2.80 4.87% 2.09%
POW $27.67 $23.82 -13.91% $1.16 4.19% -9.72%
SJR-B $21.35 $20.25 -5.15% $0.92 4.31% -0.84%
SLF $30.11 $18.90 -37.23% $1.44 4.78% -32.45%
TA $21.15 $21.02 -0.61% $1.16 5.48% 4.87%
TRP $37.99 $44.53 17.22% $1.68 4.42% 21.64%
HSE $26.55 $24.55 -7.53% $1.20 4.52% -3.01%
BCE $35.34 $42.47 20.18% $2.07 5.86% 26.03%
T $45.48 $57.64 26.74% $2.32 5.10% 31.84%
CM $78.33 $73.79 -5.80% $3.60 4.60% -1.20%
Average     -0.89%   4.81% 3.92%
             
TSX 13,443 11,955 -11.07%      

The TSX (^GSPTSE) is down 11.07% in 2011. The BTSX portfolio is down only 0.89%, an 10.18% outperformance (both figures exclude dividends). If we include dividends in our calculations then the outperformance will be even higher because the yield of the BTSX portfolio is higher than the average yield of the 60 stocks in the TSX.

Including dividends, the BTSX portfolio returned 3.92% in 2011. Good for a bad year.

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