Thursday, December 31, 2020

2020 End: $1,053,417

The last trading day of 2020 has ended, the final pay check of the year with some one-time payment from performance incentives was paid to my bank account. Surprisingly despite the disaster of COVID19, the S&P500 ended up over 15%!

My total portfolio including all cash and assets now stands at the following. 

Net worth total:
$1,053,417.75 USD

Dividends annually: 
$25,917.33 USD

After the new years weekend, I will write a year end summary and what I plan to do going forward. 2020 was a very eventful year as there was a pandemic that destroyed the paper value of my portfolio. Some companies cut the dividend, some positions were exchanged out for new ones. And some tax loss harvesting was done. Overall, the portfolio has grown and held strong with its dividend growth investing principles, and the portfolio thankfully did not succumb to the fear of COVID19 at the bottom lows. I am thankful I still have a job in these uncertain times, and continue to invest heavily into my portfolio and underspend my take home income. This saving and investing persistence for 8 years has allowed this portfolio to grow to the size it is today. The portfolio's capital appreciation plus dividend payment now accounts for a decent chunk of this portfolio's decent size, and I believe going into the future the portfolio will carry itself more and more forward instead of relying on my periodic vocational income contributions.

Happy new year to all and wish all a fantastic 2021 investing year.

Tuesday, December 29, 2020

Tax loss harvesting for 2020

Earlier this year, I sold TJX and ROST, discount department stores, due to them cutting the dividend. These two companies are still strong and I believe have strong opportunities for the future. But the loss of the dividend was not good and I had to put the cash elsewhere. TJX and ROST, even selling after the dividend cuts, were still at large gains, so I had to offset my gains with losses. I also wanted to have a net loss of around -$3000 for this year, to offset my income.

To perform this loss harvesting, I sold $22,152 of MO on 12/24 right on the ex-dividend date so I still will get the MO dividend paid in January. And I sold $31,109 of PM today on 12/29, the last day that one could register a transaction for 2020 as the settlement date has to land on 12/31. PM went ex-dividend on 12/22 so I got the dividend as well that will be paid in January.

My positions in MO and PM are the few positions in my portfolio that have net losses, nearly all my positions are positive as the market keeps going higher. I used these MO and PM losses to offset the gains from TJX and ROST. 

MO and PM already paid their dividends in October, I had dividend reinvestment turned off so there wouldn't be any wash risks. My plan is to buy back the positions of MO and PM back in the end of January or early February after the 30 day rule.

Since the sold amount is a lot of cash, around $53K, I deployed the cash temporarily into these positions that go ex-dividend some time in January month and will pay their dividends in February. This way I get even more dividends in February.

- CL: $15,754

- PG: $15,364

- GIS: $22,166

When doing tax loss harvesting, make sure dividend reinvestment is turned off or there is potential risk for a wash. And also be mindful of dividend dates and also have a replacement position in mind you can use to offset the 30 days that you are not invested in the original position.

My plan is to recycle the temporary positions in CL, PG, and GIS back into MO and PM as MO and PM are critical to increasing the average yield of my portfolio. I need to have a way to balance high yield with lower yielding companies. Higher yielding companies I have noticed do not perform as well as lower yielding companies with higher growth potential, however the dividend is still important to me and I believe MO and PM are still safe investments if one just relies on the dividend and is not there for capital appreciation. 

However, I am open to changes in opinion as I will be researching in the coming weeks for investment ideas.

Sunday, December 27, 2020

November 2020 Dividends Received

Here is a post showing the summary of November's dividends. It was a solid month with overall dividend growth showing a nice uptrend.

Ticker Total Taxable 401k
T $334.00 $333.45 $0.55
CLX $203.21 $203.21
PG $152.79 $140.38 $12.41
O $151.25 $151.25
GIS $144.39 $103.50 $40.89
APD $139.80 $139.80
GD $118.56 $118.56
CL $90.41 $77.09 $13.32
SBUX $87.04 $71.22 $15.82
ABT $77.48 $77.48
MA $37.21 $37.08 $0.13
COST $33.60 $33.60
INTEREST $0.14 $0.14
$1,569.88 $1,335.51 $234.37

Tuesday, December 1, 2020

Recent buy: O, MKC, CHD, MMM, etc

The cash pile was getting too large, so today I offloaded and bought several companies I liked. Some may be of better value recently than others. But overall, each have been part of my dividend growth portfolio for a long time and have a good track record, and I expect they will continue to excel going forward.

It should be noted, MKC split their stock price 2:1 today.

MMM: $854
XEL: $1985
WEC: $1915
O: $3382
CHD: $4945
MKC: $4653

Sunday, November 29, 2020

October 2020 Dividends Received

In October here is the summary of the dividends received. The dividends pushed strongly forward to a new record, over $2400 US dollars.

Ticker Total Taxable 401k
MO $729.85 $664.48 $65.37
PM $513.76 $452.25 $61.51
KO $177.42 $177.42
KMB $177.22 $131.25 $45.97
XEL $165.25 $165.25
ADP $156.69 $156.69
O $150.66 $150.66
ITW $136.24 $111.34 $24.90
MKC $80.55 $53.94 $26.61
MDT $61.14 $61.14
SYK $55.61 $50.35 $5.26
INTEREST $0.19 $0.19
$2,404.58 $2,024.30 $380.28

Wednesday, October 21, 2020

Recent buy: PEP, KMB, PG, GD, MMM, COST

 It has been a long time since I bought anything. The cash position is getting too large for my comfort. I bought some more average dividend yielding companies.

PEP: $1119

KMB: $590

PG: $1433

GD: $1101

MMM: $1358

COST: $759

PG had a very good earnings report today, the organic growth was very large.

Saturday, October 3, 2020

September 2020 Dividends Received

Here are the results for September. Unfortunately ROST and TJX cancelled their dividends, so they paid zero this month. I have exited those positions for around a 30% gain from my original average cost basis. The fact that their prices held up quite well despite the cut means that this cut is likely temporary and things will go back to normal for TJX and ROST after the COVID situation clears. 

I had done substantial homework to prevent dividend cuts in my portfolio, but some events just happen that impact the whole economy. Some of my learnings from past failures include 2014, when oil prices tanked and SDRL (Seadrill), a deep water drilling company, cut its huge dividend and same with KMI (Kinder Morgan), an oil pipeline company. Seadrill taught me now to chase yield, and this oil incident taught me not to focus my investments in cyclical businesses or companies highly influenced by commodity prices.

Similarly, KHC (Kraft Heinz) cut its dividend in 2019 after disappointing results of combining Kraft and Heinz together, and the large debt that followed. The KHC situation made me become wary of huge debt funded acquisitions, it made me become wary of debt which is why I am looking over companies like Altria and AT&T very carefully now.  The KHC results made me focus on the balance sheet strength on my existing positions or new positions.

And in 2020 due to COVID, businesses that require visitors going outside their homes suffered which impacted my TJX and ROST. My positions in McDonald's and Starbucks were also spooked initially but they demonstrated the ability to weather through due to their more defensive nature.

Despite the cuts in TJX and ROST, the monthly dividend trend is still moving upward nicely, albeit at a slower pace due to COVID. Nobody could have known last year that a pandemic would happen in 2020, it's one of the most random incidents I have seen so far that changed the world forever. The diversified portfolio I show below is demonstrating its resilience in protecting the portfolio's dividend generating capabilities. Although I have sacrificed alpha by using diversification, I am happy to avoid large losses by having a resilient portfolio, and it is during turbulent times like these when a diversified and defensive portfolio shows its abilities.

Note Dominion (D) is cutting its dividend by around 28% starting in 2021 after it announced selling some of its assets to Berkshire. Selling large assets reduces revenue generating capabilities for D, which means dividends have to go down to balance things out. The dividend from D below is unchanged as of now, but I am considering if I should exit it for other dividend payers as there will be a sharp tick downward in that position. From the perspective of the overall portfolio, it's a small decrease, but I have a tendency to review positions when they cut their dividend. D has held up well, and my position is still sitting on small gains (not as large as TJX and ROST). Given that D has paid me large dividends in the past, I am not terribly disappointed in the position, as it is has served its job as a utility. However, it has lagged severely behind my NEE and XEL and WEC utility positions (those 3 really don't look like utility stocks anymore to be honest, after their large gains).

Ticker Total Taxable 401k
JNJ $275.37 $269.06 $6.31
PEP $248.77 $212.44 $36.33
HD $221.18 $192.48 $28.70
NEE $212.05 $161.24 $50.81
MMM $190.71 $162.83 $27.88
D $163.76 $108.28 $55.48
WEC $152.58 $134.78 $17.80
O $123.98 $123.98
V $81.27 $64.62 $16.65
BDX $80.82 $80.82
MSFT $67.45 $39.35 $28.10
MCD $66.55 $66.55
HON $61.15 $61.15
CHD $52.83 $37.17 $15.66
INTEREST $0.09 $0.08 $0.01
ROST $0.00 $0.00
TJX $0.00 $0.00
$1,998.56 $1,590.85 $407.71

Thursday, October 1, 2020

August 2020 Dividends Received

Below is a plot of what was received in August. The dividends topped $1440. This month is a lower paying month, the trend is still upward. Nothing beats getting paid even during the COVID disaster.

The September numbers are coming out soon, I will update those shortly.

Aug Ticker Total Taxable 401k
T $322.68 $322.14 $0.54
CLX $202.21 $202.21
PG $138.53 $126.19 $12.34
APD $139.14 $139.14
GIS $122.59 $83.61 $38.98
CL $89.89 $76.65 $13.24
O $123.51 $123.51
SBUX $78.88 $64.54 $14.34
GD $91.49 $91.49
ABT $77.21 $77.21
MA $37.96 $29.84 $8.12
COST $16.10 $16.10
INTEREST $0.03 $0.01 $0.02
$1,440.22 $1,229.13 $211.09