Wednesday, October 31, 2012

Recent Buy

This morning I added to my position in Norfolk Southern Co. (NSC) by purchasing 20 more shares at a price of $61.96 in my Roth IRA.  Earlier this month NSC announced disappointing 3rd quarter results and the share price quickly sold off.  It lost over 7% the day the earnings were released.  With the addition of 20 more shares I doubled my position in NSC from my original purchase in late September.

I figured now was as good a time as ever to take the chance to average down in my position.  I missed the lowest price that it's seen since the earnings announcement but I'm not going to complain about the opportunity that I got to take advantage of.  My cost basis for the new shares is $62.36 which brought my average cost basis down from $65.54 to $63.95, a 2.43% decrease.  The YOC for the position increased from 3.05% to 3.13% and for the Roth IRA portfolio the YOC increased from 2.94% to 2.99%.  The additional 20 shares will add an extra $40.00 in annual dividends before reinvestment or further increases.  Unfortunately I purchased the shares today, the ex-dividend date, since the markets were closed earlier this week and will not be receiving the next dividend payment in December.

I was tempted to use the rest of the cash available to purchase NSC but just couldn't devote that large a percentage of my overall portfolio to NSC alone.  I have enough cash left over to make a small purchase or use to try and average down in another position between now and the rest of the year.  Either that or I'll be saving it up until I can start contributing again in the new year.

The forward 12-month dividends for my Roth IRA portfolio is now up to $180.08.


  1. That's a fine price you got there. Good one!

    1. CI,

      Thanks! I could have gotten it cheaper but I'm still happy with the price. I'm more annoyed that I missed the next dividend payment because of the stock market closure. Oh well, it shouldn't matter in the long run, but it's just a minor annoyance right now.

      Thanks for stopping by!