Saturday, November 30, 2019

November 2019 Portfolio Summary

In terms of equity pricing movements, November was a good month. The SP500 is pushing the new high barrier, and is well over 3000 now. Despite all the chatter about the trade war hurting the USA, the USA economic indicators shows a robust strong economy, and there are some "signs" that a trade talk with China is progressing better, leading to some more market optimism. I am in the view that the longer the trade war goes, the more it impacts negatively China and the longer this goes the more China will be pressed to sign an agreement, and the longer it goes the less favorable the agreement will be for China. As economic and export indicators show, the USA will suffer but not at the scale of China as many factories which US corporations setup in China will flee to other neighboring Asian countries that do not have these trade problems, such as Vietnam, Malaysia, Taiwan, South Korea, etc. There is actually an ongoing economic boom in many of these China neighboring Asian countries as new factories get setup and people are competing for manpower and resources to meet the new demand.

Putting trade talks aside as this is an investing blog not a political blog, the market treasury yields are all very low, the 10 year is at a measly 1.78%. This impacts equity prices, as lower interest rates means stock prices go up (and stock yields go down). In this environment, it is good if you held existing stock positions, but if you are constantly looking to buy more positions it is a bad time as everything has a very low payout yield due to inflated prices.

Thursday, November 21, 2019

Annual dividend income crosses $20,000 USD

Today, after tallying up recent dividend income that came in which were automatically reinvested, and investing another $2000 further from my own contribution, my portfolio crossed $20,000 in annual dividend income.

The purchases are the following:
CLX: $584
ADP: $849
3M: $494
T: $75

I usually slip in a few AT&T (T) shares at the end of all my purchase batches, since AT&T shares are cheap per share, so I can spend the remainder of my monies left over after buying more expensive share blocks. Trade commissions are free for me. The dividend income now sits at $20,027.54

This amount is increasing at an average of 9.6% and dividend yield is 2.6%, in total with dividend reinvested the portfolio is estimated to grow at around 12-12.5% in 2019. This type of growth I believe will allow my $20,027 dividend income to grow to $22,530 in one year all by itself without any further contribution from my side. This is the power of the double compounding effect that has been driving my portfolio higher year after year (i.e. the company pays dividends every year which get reinvested into even more shares that pay even more dividends, and the dividends from each of the companies increase every year on their own further empowering the dividend each share generates).

I can easily increase my dividend income to over $30K if I invested in higher risk assets or low growth, higher volatility, high yielding companies. I do not like to invest in these types of high yield companies as it exposes me to more risk, less growth. And I do not need to take such risk as I am still young and do not need the income. Instead, I would prefer investing in moderate yielding or even low yielding companies as long as the dividend is growing well above the rate of inflation. For me, a dividend growth rate + dividend yield that is 12% or over is what I find attractive to invest in. Usually that may be a 2% yield plus a 10% dividend growth, or a 1% yield and 15% growth. On average I try to maintain this 12% total dividend growth (with dividend reinvested) figure for my whole portfolio, which my track record has shown has been maintained over the last 6 years.

Friday, November 15, 2019

Recent buy: GIS, KO, CLX

Around 2K added today.

KO: $578
CLX: $435
GIS: $998

These are consumer staple names, been in my portfolio for a long time.

Now my forward annual dividend is $19,958 USD
Getting very close to 20K!

Friday, November 8, 2019

Recent buy: WEC, NEE, XEL

At last, the utility companies are pulling back. I will keep adding on the drops and plan to just average myself in as I want more utility exposure. If they can get over 3% yield that is most ideal. Here are the additions today. The top 3 utilities I like to eye are NEE as Number 1, and then XEL and WEC are my favorites behind NEE. NEE has grown to be in the top 5 list of positions in my portfolio mainly by its own effort. It has a very impressive earnings and dividend growth history spanning decades.

NEE: $221
XEL: $480
WEC: $263

Trades are free for me really so low dollar value trades are not an issue. $964 was invested.

Sunday, November 3, 2019

October 2019 Dividends Received

Here is a tally of all the cash received last month from my investments.

This is a record month. All dividends were reinvested to fund the income snowball machine I am trying to build.

Ticker      Total    Taxable         401k
MO $549.92 $474.56 $75.36
PM $472.03 $415.52 $56.51
KMB $145.23 $102.32 $42.91
XEL $135.41 $135.41
KO $126.95 $126.95
ITW $119.34 $96.57 $22.77
ADP $85.97 $85.97
MKC $72.99 $48.87 $24.12
O $72.84 $72.84
MDT $40.35 $40.35
SYK $35.24 $30.54 $4.70
INTEREST $0.48 $0.48
$1,856.75 $1,557.54 $299.21