It's now official, Russia and Ukraine are at war since yesterday, late at night. Both countries have already dozens of death and this conflict is only at its beginning. Germany and the UK had delivered strong responses against the conflict, which was amazing, but will it be enough? European countries need to remain strong against Russia. Now more than ever is the time for those countries to come up with ways to become energetically independent.
I hope that I am wrong, but my feeling is that Poutine doesn't care much in regards to the international response, he just wants to invade Ukraine at all cost, no matter what, because this is his obsession. What Poutine wants is to extend Russia's territory on the back of Ukraine and he wants to make it happen, no matter what it takes. Will World War Three be declared? I don't think so, because only Ukraine is being involved, at least so far. Will the USA intervene in the conflict with a military response? No, because they didn't do anything when the Taliban took over Afghanistan. These days, when horrible conflicts happen, the international response is usually quite low, and everyone manages their business on their own side. It's sad, but it's how it is.
During that time, things are not looking very good for the TSX. Overall, my non-registered, TFSA, US, and RRSP portfolios are going all over the place. Today so far, my account summary went down with a variation from -$2,000 and a bit more to -$500 and less in a very short period of time. It's not fun to watch, but I had now been invested in stocks, for now, close to 15 years. I had seen a lot of volatility over the TSX, a lot of stuff happenings. And please remember that I had started investing in stocks shortly before the 2008 stock crash. I am now used to this stock market shit. However, I must admit it's always a bit frightening, no matter what. Its while the markets are low that you need to invest in stocks, that's how I basically built my portfolio, by taking advantage - among others - of the 2008 stock crash.
It's not going to be an easy one because as long as the conflict remains, it's easy to understand that unfortunately, the TSX will remain extra volatile. I am watching the situation very closely because as you might know by now, I have a margin account debt that is linked to my non-registered portfolio. Currently, my margin debt is at a bit more than $46,000. For now, everything is under control, my buying power left is over $40,000. I am with National Bank Direct Brokerage. I don't have any chequing account with National Bank, so I have no way to transfer immediately cash funds in real-time inside my non-registered portfolio if needed. This is not practical, but I had come up with an emergency plan in case of need.
My first option: I have a US portfolio that is worth in the $6,000 Canadian dollars. In case of need, I wouldn't mind selling my US portfolio. I could easily transfer the cash over my non-registered portfolio to help secure my margin debt. That's one option that could save me. When dealing with things of this nature, it's really important to come up with some scenarios. You need to be prepared in case of need. Personally, I don't have a real attachment to my US portfolio - it's only US stocks after all LOL. It wouldn't destroy me if I had to sell my US portfolio.
My second option: to sell some assets hold inside my TFSA and transferred the cash to my non-registered portfolio. I already target some stocks, like JFS.UN for example that I could sell.
A third option, that I could do as of right now is to take the money from my different savings accounts and get it transferred over my non-registered portfolio. This will decrease my margin debt, and protect it at the same time. Because the lower my margin account debt is, the better it is for me. I still thinking about it, but I am probably going to take action. This is only the first day of war between Russia and Ukraine, and the TSX is already down to 20,500 points...
Eventually, I could even withdraw some money from my RRSP portfolio and transferred it over my non-registered portfolio but this would be my last resort because of the penalties linked to RRSP withdrawals.
This whole mess didn't stop me from doing two investments today. I had invested in Labrador Iron Ore Royalty Corporation (LIF) for my TFSA portfolio, and Power Corporation of Canada Subordinate Voting Shares (POW) for my RRSP portfolio. My annual dividend income is now at a very very close $10,900.
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