Saturday, December 31, 2011

Dividend Update - December 2011

December brought about 5 dividend payouts and my biggest monthly payout to date. Here's the breakdown.
Dividend Shares
Pfizer $4.60 0.230
Coca-Cola $17.86 0.268
McDonalds $4.90 0.050
Waste Management $3.40 0.107
Bank of America $1.80 0.351

Total December Income $32.56

Total Dividends received in 2011 $48.72

Friday, December 30, 2011

Position Decision

I'm torn on what to do with my position in Pfizer. I have made 17% since September 13th which is a huge run-up in price giving me an approximate 70% CAGR, even though that is no where near sustainable. My YOC is 4.31% and the current dividend yield is around 3.7%. I'm debating on whether I should sell and lock in the gain and put it to work in something else. Unfortunately the stock market has had a nice close to the year, I'm expecting continued volatility in 2012 giving much better entry points than current ones. If the current dividend yield gets down to 3% I'll be selling in a heartbeat. I'm putting in a a limit sell order at $26.67, the 3% yield price, as soon as this posts.

Sunday, December 25, 2011

Merry Christmas!!!

Merry Christmas to everyone. Hopefully you're getting the chance to share this time of year with those you love.

Saturday, December 24, 2011

Recent Buys

On December 14th I added to my positions in both Intel and Bank of America. I purchased 30 shares of INTC at $23.27 and 80 shares of BAC at $5.25. My YOC for the new INTC shares 3.57% and the BAC YOC is 0.75%. The purchases have brought my YOC for my taxable account down to 2.80% without including dividend increases that have been announced. I want to get my total YOC to at least 3.00% so I've got a ways to go. An increase in the BAC dividend would do a lot to help that out. Unfortunately I see that taking at least another year until then.

Saturday, December 10, 2011

Net Worth Update for November 2011

November was a good month and saw my assets creep up over $100k. Unfortunuately I still have quite a bit of debt that I'm paying off that I will hopefully be done with late 2012 or early 2013, depends on how much I work since I get paid by the day.

Current Assets $100,099.60
Current Debts $37,267.64

Net Worth $62,831.96

My savings rate from my take home pay for November was 72.96% which is my 3rd highest for the year.

YTD my net worth has increased $61,557.62 which is awesome. I'll post % gains for the total year with next month's update. All my investments combined are currently at $55,262.14 and are climbing rapidly. I'll be maxing out my 401k and my Roth IRA this year.

Wednesday, December 7, 2011

Dividend Update - November 2011

November brought my first month with multiple dividends paying out. It's definitely a start to the process of setting up a solid passive income stream. Here's the breakdown.

Wells Fargo $1.56
ConocoPhillips $10.56

Total November Income $12.12

Total dividends received in 2011 $16.16

I'm looking forward to the next market dip to be able to purchase again since they offer spending sprees that I like.

December will see 4 companies paying out for me and my largest monthly dividend stream. I can't wait to get paid for sitting and doing nothing by owning solid companies.

Tuesday, November 22, 2011

Site Changes

I've added a My Portfolio page that shows all the positions that I have and will be adding a dividends page sometime within the next few weeks. I like how my portfolio has been coming along and just need more capital at this point. Donations will be accepted.

My current annual payout (if I didn' reinvest my dividends and the dividends aren't increased) is $278.08. Not bad but I still have lots of work to do on that front.

Recent Buys

This morning I bought 20 shares of AT&T @ $28.29 and 15 shares of Intel at $23.24. It's days like the last week where I wish I had more capital. The shares of T are giving me a 6% YOC and INTC are giving me 3.53%. I don't expect AT&T to give me much dividend growth but I figured I could use some quality and stable high YOC for the moment. I feel that Intel can continue to grow it's dividend in the high single to low double digits and that will just be gravy for a company as dominant in its own niche as Intel. And if they can somehow break in to the tablet industry the prospects are even better. These purchases raised my YOC for my portfolio to 2.99% from 2.72%. I want to get the YOC up but I've taken a flier on BAC. If the global and domestic financial system can get to some semblance of stability I think BAC will work out nicely. Obviously this is a 2-5 year wait and see approach for BAC but the potential gains I feel greatly outweigh the risks. Just a annual dividend for BAC of $0.40 gives me a YOC over 6%.

Thursday, November 10, 2011

Recent Buy

I decided to open my Roth IRA with Fidelity just to keep everything together for now.

And the first purchase I made was for 25 shares of Wells Fargo (WFC). At the current dividend payout of $0.48 / yr and my purchase price of $25 / share my YOC is 1.90%. Wells Fargo to me is currently trading at a premium to some of the other financials but I feel that they are one of the safest bets among the big banks. The financials have been hit really bad and I feel that given my long-term outlook it is a great opportunity to get in selectively. I would have liked the price to be lower but wouldn't we all. They slashed their annual dividend down to $0.20 / share during the financial crisis but have already had a special dividend earlier this year and raised it by 140% since. I think they will be raising their dividend fairly quickly and within 2 years will be back to the pre-financial crisis levels of $1.36 / share. That will bring my YOC to 5.37% in a short amount of time. For a big bank as solid and conservative as Wells Fargo this seemed like a great opportunity for the long-term.

Monday, November 7, 2011

Lessons 1, 2 & 3 learned

Lesson 1: Know what your investment style is before you start investing. Granted different situations call for different styles, but you should know your core investment style and goals that you're after. I unfortunately didn't really plan this out but have settled on focusing on dividend growth stocks with the occasional pure growth.

Lesson 2: Be wary of small lot purchases. I funded my brokerage account and was ready to trade as soon as the money hit the account. My first lesson learned is to be wary of commissions. I decided I wanted to buy some EOG Resources (EOG) and felt that $94.50 was a decent price given they're substantial acreages in some big name domestic shale plays. They were able to get in early which means cheap in the Eagleford shale and have had unheard of production from the wells they've completed there. Unfortunately being a beginning investor I didn't have much capital to invest and so I had to make some decisions. I was ready to own the world through my investing and didn't allocate nearly enough to the shares I purchased. I spent nearly 1/3 of my capital at the time to purchase 4 shares at $94.50. Not smart. The shares had to appreciate by 2.1% just to break even to my new adjusted cost basis. Not to mention that to sell I have to dish out another $7.95 in commission meaning the shares have to appreciate a further 2.1% for me to truly break even. So my lesson has been learned.

Lesson 3: Have the courage of your convictions and purchase more shares to average down. I truly believed that EOG would climb in value. Unfortunately the Euro mess arrived and pushed the shares down to the low $70's, I think they even touched the upper $60's. I thought that my belief's were right but I was still a 2 month old when it came to individual stock picking. My capital had grown through new investments but I still didn't have enough to commit to a further position. So instead of averaging down to a cost basis in the low to mid $80's or lower depending on how much I wanted to invest I'm sitting on around a 5.4% gain instead of the 20-30% gain that I could have been at. So lesson learned is if the stock goes down and nothing has changed think of it as a sale.

ROTH IRA

I originially opened a Roth IRA to invest in mutual funds through Vanguard. I got to thinking about the expense ratios, which Vanguard is usually the lowest, however by purchasing solid dividend paying companies with solid fundamentals you'll pay far less in expenses over the long-term. A more detailed post will be coming about this.

So my question is should I open a ROTH IRA brokerage account through Fidelity where I currently have my brokerage account or somewhere else? I'll be a fairly passive investor choosing the best of my watchlist and trading no more than 10-12 times per year.

Sunday, November 6, 2011

In the beginning...

I currently work a job where I am paid quite well for honestly very little work. The major drawback being that I'm away from home which makes it difficult. I figured that since I'm making good money I might as well do something with it that will lead me to a life where my fiancee and I can just do what we love to do and money won't be an issue. I've just begun my pursuit of getting paid to not work and am looking forward to what 2012 has in store so I can invest more since we won't be saving for the wedding anymore. My portfolio is quite small right now and like most beginning investors I've made some mistakes due to inexperience. But trial by fire is always a good thing. I'll update a few times each week on what I'm thinking and how I stand financially. I've made some great gains over the last 14 months or so while saving for retirement and am starting to focus on non-tax-sheltered investing for my passive investing. Here's my starting points as of the end of last October 2011.

IRA $10863.69
Roth IRA $ 8485.49
401k $20926.01
Brokerage Account $ 7176.64
ESPP $ 3458.36
Other Stocks $ 1991.16

Total $52901.35

Annual Dividend Payout $266.84

Net Worth $61364.23