Portfolio: February 2019

The February Dividend Farmer update offers no significant changes relative to the January distribution.  There were no new additions or subtractions to the portfolio during the month.  REIT holdings continue to lead the portfolio weight.  Although I’ve reviewed a couple of firms that might be additive to the manufacturing sector, no new holdings have been acquired.

Overall, a few segments moved up or down a tenth of a percentage point, but the portfolio has held steady in terms of segment distribution.  None of the holdings experienced significant events, good or bad.

The yield relative to current price dipped from 3.94% in January to 3.9% in February due to portfolio value increases which drove the numerator higher in the yield ratio. 

All dividends are automatically reinvested with no transactions fees.  Unweighted average yield on cost also dipped to 4.4% as newly reinvested shares purchased at higher rates advance the average cost of shares in the portfolio.  However, yield on cost remains a full half a percentage above the current yield on price of 3.9%.

The average monthly dividend growth from this basket continues moving upward standing now at just above $1,160.  The trailing twelve month growth rate fell to 13.1% due to the fact that February is a fairly light month for dividend payments in this particular portfolio.  All the same, the dividend stream growth rate would double in about 5.5 years and is still comfortably above the desired 10% figure I’d like to maintain. 

Each month generates additional income stream growth through the power of compounding in a slow, steady manner.  The Rule of 72 post offers further detail about the power of compounding.  The remarkable thing about compound growth is that if you’re patient you’ll eventually reach a point at which critical mass is achieved and growth in your dividend stream takes off.  That’s why this Dividend Farmer is an advocate of dividend investing.

The thoughts and opinions provided are those of the author, who is not a financial professional.  Opinions expressed here should not be considered investment advice.  They are presented for discussion and entertainment purposes only.  For specific investment advice or assistance, please contact a registered investment advisor, licensed broker, or other financial professional.

Portfolio: November 2018

The November Dividend Farmer update saw a shift in portfolio weight relative to October.  Changes to weights at the bottom end of the basket were attributable to the addition of 100 shares of a telco.  Conversely, changes to weighted position at the top end were due mostly to REIT holdings all paying dividends, automatically reinvested, during the month.

In monitoring news articles and blogs no issues were found to be overly concerning regarding my holdings.  Once again, I’m not checking ticker symbols on a regular basis since my focus is on building the dividend income stream rather than market value.  Consequently, I try to focus on substantive issues adversely affecting the abilities of the investments to generate cash and didn’t find any in headline.  

The yield relative to current price bumped up from 3.82% in October to 3.84% in November due to the addition of the telco stock with an individual yield sufficiently high that it moved the portfolio yield ever so slightly.  All dividends are automatically reinvested with no transactions fees.  Unweighted average yield on cost is about 4.6%; nearly 1% higher than the current yield on price of 3.84%.

The average monthly dividend from this basket has now surpassed $1,100 – by a few bucks.  That doesn’t pay all the bills, but it is nice supplemental income if needed.  The trailing 1-year CAGR ballooned from 10.6% to 12.6%.  In looking at past history, jumps like these appear to coincide with dividend increases announced by multiple holdings in a single month.  Each month accelerates the income stream growth through the power of compounding.  The Compound Growth post offers more detail about the power of compounding your dividends through automatic reinvestment.

The thoughts and opinions expressed here are those of the author, who is not a financial professional.  Opinions expressed here should not be considered investment advice.  They are presented for discussion and entertainment purposes only.  For specific investment advice or assistance, please contact a registered investment advisor, licensed broker, or other financial professional.

Portfolio: October 2018

It’s time for the monthly update on my crop’s progress which is important as a Dividend Farmer.  Since the September update, there have been no major events adversely affecting my current holdings.

Although I monitor news articles and blogs for activity that might be unfavorable to my basket of stock, I’m not checking ticker prices on a daily basis.  Doing so invites a level of consternation I don’t need.  Instead, each investment is reviewed monthly to update dividend increases, price changes, and increases in stock quantities due to reinvested dividends paid during the month.

Not many changes relative to last month and no additions to principle.  However, due to dividend reinvestments in some segments, but not others, the percentages across segments have shifted slightly.  For instance, REITs were my top holding last month, but slid into second position in October.  Telco and Finance swapped rank order this month as well.  

The yield relative to current price dipped from 3.86% in September to 3.82% in October due to stock price increases across various holdings.  All dividends are automatically reinvested with no transactions fees.  Unweighted average yield on cost is approaching 4.6%; nearly 1% higher than yield on price.

The average monthly dividend from this basket is approaching $1,100.  That won’t pay all the bills, but it’ll put a nice dent in them if needed.  With a trailing 1-year CAGR of 10.6%, the long-term dividend farming strategy embarked upon 8 years ago is approaching the point of critical mass.  If you check out the Compound Growth post you’ll gain a sense of what I mean.

The thoughts and opinions expressed here are those of the author, who is not a financial professional.  Opinions expressed here should not be considered investment advice.  They are presented for discussion and entertainment purposes only.  For specific investment advice or assistance, please contact a registered investment advisor, licensed broker, or other financial professional. 

Portfolio: September 2018

Tracking my crop’s progress on a monthly basis is an important part of being a Dividend Farmer.  Although I casually monitor news articles and blogs for major events that may affect my investments one way or another, I’m not checking ticker prices on a daily basis.  Instead, each investment is reviewed once a month to record dividend increases, prices changes, and increases in stock quantities due to reinvested dividend paid during the month.

With that in mind, below is the September snapshot of a portion of my portfolio.  I segmented the group by industry and inserted a simple chart to demonstrate how I’ve allocated my dividend selections.

Every stock within each category is a dividend payer.  With the exception of the BDC segment, each category contains two to four different holdings.

This basket of stocks has a current dividend yield, relative to current price, of 3.86%.  All dividends are automatically reinvested with no transactions fees.  Because I’ve held most of these investments for several years, the yield on cost (initial purchase price) is actually .3% to 1.6% greater than the yield on price.  The higher yield on cost results from dividend increases relative to the initial purchase price which remains fixed. 

The total dividends from this basket is tracking to an annual run-rate north of $12,000.  It took several years to get here, but now the dividend returns are outstripping anything I can contribute to my 401K including a company match.  For instance, using $12,000, a 3% contribution, and a 3% company match, my salary would have to be over $200,000 a year to have a similar amount of money injected into my portfolio.  I’ll never command that kind of income.  Ever.  With a long-term dividend investment strategy leveraging the effects of compounding, I don’t have to.  Neither do you.  You just need to get started with the 4Things a Dividend Farmer Needs and work from there.  Food for thought…

The thoughts and opinions expressed here are those of the author, who is not a financial professional.  Opinions expressed here should not be considered investment advice.  They are presented for discussion and entertainment purposes only.  For specific investment advice or assistance, please contact a registered investment advisor, licensed broker, or other financial professional.