Recent buy: MMM, ITW, GD

The last two weeks have been a godsend for me. I am seeing 10% discounts across the board for some high quality companies that have absolutely no change in fundamentals. I have no idea why the market is reacting the way it is. Some say it's because of rising interest rates. Others say it's due to margin calls due to over leverage on the volatility derivatives. To me, the companies I own have still the same fundamentals a month ago as they do now, and I do not see any danger in any of the companies I own in regards to their dividend payout ratios. All that has changed for me is the lower purchase price which makes buying a lot easier as yield % have gone up on every single company. This makes every single dollar that I put to work now much more effective than the dollars I deployed a month ago. Everyone is panicking but I do not understand the mindset. I am finding the opportunities given in this period to be positive especially given the tail winds many of these companies are experiencing (i.e. lower tax rates and repatriation and expanding markets and weaker dollar).

My strategy this time is to load up on the highest quality dividend paying companies in sectors that I am too underweight in. Since I have around 1/3 my portfolio in consumer staples, I want to pay less attention to that sector. I will focus on industrials (6% weight) and healthcare (14% weight) first. Since these more cyclical sectors tend to have a higher beta, they should have larger pull back percentages than pullbacks seen in the consumer staples space. Materials (1% weight) and Tech (2% weight) are sectors I will also be looking at but those are sectors I do not have such a high priority in. I only have so much money to go around when buying. For financials (9%) I will be only looking at Visa and Mastercard which to me are very expensive and I already have quite a lot of both (their yields % are quite low for me), so those two are lower priority.

For REITs, I do not plan to add more in the short term. I will only reinvest the high % dividends. REITs do not do so well in rising interest rates and I have enough position in "O" to make me happy. I do want more utilities, it's one of my favorites sectors. However I think there is more room to fall given the headwinds and negative narrative of rising interest rates. The companies in that sector are just way too overvalued given the rising rate environment. There's better names elsewhere to get with a higher growth rate for the same P/E ratios than sticking to the overvalued companies in the utilities sector. The only exception I would say is NEE which I always am looking forward to add. I prefer to prioritize purchasing companies that I feel have a higher propensity to "spring" back up due to a positive growth environment (industrials and defense companies for example) instead of companies that will have a negative narrative (rising interest rates) looking forward for a long time.

Today I bought:

$457 - MMM

$422 - GD

$322 - ITW

All three are industrials that pulled back recently.