August 31, 2017

Investing for a Good Cause

When I was in high school, I remember I had thoughts of working for an investment fund that would work towards funding social causes.  In other words, the proceeds of these funds such as dividends and capital appreciation returns would be used to fund charitable programs.  I was a bit idealistic and naive back then, because years later (today) I realized… I can do it now with my own money, why should I work for someone else’s investment fund when I can just simply start my own?

Upon realizing this and several years later, this is how my own social fund is born.  To start, I decided to seed it with $1000 CDN.  

The investment objective: To grow the investment fund by investing in strong growth companies for capital appreciation returns, and collecting monthly dividends to donate to worth while social causes.

For now, I have invested almost the entire amount in a Canadian REIT: Nexus REIT.  One of the reasons why I invested in this company is because of the high dividend yields, and I felt this company has a good track record for growth.  I also know I’m taking on a bit more risk with this company as it does have a slightly elevated risk profile compared to other similar REITs.  If you want a full breakdown of my analysis of this company, click here

To some people, I know it seems bizarre because why not donate the entire $1000 to support a cause.  The main reason is because I wanted to do it in a sustainable way where the initial principal could in the long run earn even more money.  Also, $1,000 is a lot of money to me so in case I need it for emergency, the money is there.  

As for the organization to donate to, I decided on the Canadian Museum for Human Rights.  Coming to this museum back in June 2017 made me realize how important basic human rights are.  I think it is just as important as having food and shelter.  The right to practice your own faith, the rights of refugees, to the rights for people with disabilities, and the list can go on.  To check out their website, click here.

For a breakdown how this fund will work, the dividends I’m earning a month from Nexus REIT is about $6.62 ($0.01333 in monthly dividend per share).  With it, I have committed to donating $6.50 to the organization.  It isn’t much, but it is a start.  You can check out the fund breakdown by clicking here

 While the short term goal is to earn consistent monthly dividends for donating.  The long term investment objective is to grow the fund through capital gains.  Hopefully in time, the stock price will have risen in value that I can use it to buy more shares – and grow the fund.  

I’m excited to see where this fund goes in the future.  Maybe this fund can grow bigger or maybe it might crash.  We’ll see what happens.  

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