Got $10,000? 1 Dividend Stock for $61 in Monthly Passive Income

Boost your monthly returns by investing in this high-quality TSX monthly dividend stock and adding it to your self-directed investment portfolio.

Adam Othman

Adam is a value investor who is always on the hunt for fantastic undervalued companies that he can share with Motley Fool readers. He follows Warren Buffett and Charlie Munger's investment advice and has completed the Canadian Securities Course. When he's not investing, Adam can usually be found traveling or skiing.

Published January 23, 8:30 pm EST

Stock market investing isn’t all about making big moves and investing in companies that suddenly make you rich overnight. While there is always the odd chance that can happen, there are more sustainable ways to approach stock market investing to grow your wealth. Seasoned investors know and understand how to use the equity securities market to achieve their financial goals without unnecessary risks.

A slow and steady approach, whereby you use stock market investing as a passive income stream, can be an excellent way to put your money to work. If you have $10,000, investing it across a portfolio of monthly dividend stocks can unlock regular passive income to boost your earnings or achieve various financial goals.

Today, I will discuss a monthly dividend stock you can consider investing in for this purpose.

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Diversified Royalty

Diversified Royalty Corp. (TSX:DIV) can be an excellent pick for dividend investors seeking monthly returns instead of waiting for quarterly dividends. Monthly payouts offer faster compounding, smoother cash flows, and the feeling that you’re making extra money in your sleep every month without lifting a finger.

Diversified Royalty is a $662.36 million market-cap multi-royalty company that acquires royalties from multi-location businesses and franchisors across North America. It offers businesses it acquires complete operational control, participates in their growth, and offers tax deductibility on royal payments. In turn, it purchases trademarks of the companies it acquires, creating a win-win scenario for Diversified Royalty and its partners.

[Insert chart here – Diversified Royalty (Ticker:DIV)]

2025 saw the company increase its payouts twice, owing to its solid business model. The company doesn’t focus on running the day-to-day operations of the shops and restaurants it acquires. Instead, it lets the companies run their operations while giving Diversified Royalty a cut of the sales.

Diversified Royalty has been busy with acquisitions, and its business model has been successful. The company targets established names with immense growth potential. This lets it acquire a predictable royalty stream. The reliable income that it generates from royalties, in turn, helps the investor in top-line royalties fund its growing monthly dividends.

The third quarter of 2025 saw distributable cash rise by 18.8% from the same period in the previous year. The payout ratio also declined from 94.1% in the same quarter last year to 89.3%, reflecting the ease on the company’s balance sheet when paying out monthly distributions.

Foolish takeaway

While you should always diversify your capital when investing in the stock market, I want to show you what a hypothetical $10,000 investment in Diversified Royalty stock can do in terms of monthly dividends. When actually investing in the stock market, be mindful that you diversify your investment capital across several assets to minimize the risk. For the sake of explaining the example, the table below shows what a $10,000 investment in DIV stock shares would return: