Saturday, September 29, 2012
The most challenging aspect of dividend investing - Dividend Growth Investor wrote a great article on the psychology of dividend growth investing.
Your Savings Rate Trumps Your Investment Returns - Dividend Mantra's piece on why focusing on what you can control, such as your savings rate, is so important. It is especially important for those that are set on retiring early.
Tuesday, September 25, 2012
This afternoon I purchased 20 shares of Norfolk Southern Corporation (NSC) for $65.14 per share for my Roth IRA. My total cost basis after commission is $1310.75 or $65.54 per share. NSC has increased their dividend twice this year which is a good sign for management's commitment to rewarding shareholders and belief in the underlying business. Railroads are local monopolies and I feel that NSC's business will pick back up. These shares have a 3.05% YOC and will provide an extra $40 per year in dividends before reinvestment or further increases.
Sunday, September 23, 2012
Saturday, September 22, 2012
YOLO - Dividend Mantra had a great post about why he's saving and investing to become financially independent at a young age. It was a great article and something I firmly believe in.
3 Easy Steps to Retire by 40 - Going with the early retirement/financial independence theme, here's a post from Retire by 40 outlining the 3 steps to reach FI. While the 1st step might not be completely realistic for everyone, it's still something to consider, especially when considering career options.
Thursday, September 20, 2012
I hope everyone else is having a great month of dividends!
Wednesday, September 19, 2012
Saturday, September 15, 2012
Trading Vs. Investing Dividend Mantra wrote about the difference between trading and investing and why he's first and foremost an investor.
Procter and Gamble: Still a Champion Blue-Chip? Dividend Monk analyzed the status of Procter & Gamble. He feels it's fairly valued where it's currently trading and wouldn't be buying without a 10% pullback.
Dividend Investors are Getting Paid for Holding Dividend Stocks Dividend Growth Investor had a great post that pretty much sums up the reasons to invest in dividend growth stocks.
Stop the Bleeding! - Internet Service All About Interest wrote about what he's done to lower his bills to find more investment capital.
Philip Morris Increases Dividend Compounding Income highlighted the recent dividend increase by Phillip Morris.(PM).
Dividend Growth Investing; Give Us Your Tired, Poor And Unguided Seeking Alpha is one of my favorite spots on the web to read articles on investing and DGI in particular.
Friday, September 14, 2012
If ADM is trading above $26 on expiration then I will pocket the full $81.01 premium. That would be a return of $81.01 / $2,600 = 3.09%. Even better is that I would have gotten that return in 99 days which is equivalent to a 11.39% annual return.
Thursday, September 13, 2012
The American people haven't been purchasing houses because they either don't have jobs, don't work enough hours or have no idea what the future of their job is. It's not because mortgage rates are too high, they're at all-time lows. What I see as the reason for doing this is to further clean up the banks' balance sheets by taking MBS off their books and hopefully spurring further lending by the banks with a pocket full of cash and low interest rates.
Wednesday, September 12, 2012
I was able to compile all the data and crunch the numbers to compare my total returns vs the SPY ETF that tracks the S&P 500. I gathered data from Yahoo! Finance's Historical Prices for the SPY. The historical prices gives the open, high, low, close & adj. close prices corresponding to each date. The adjusted close price is the price adjusted for all dividends and stock splits. It's an easier way to compare total returns without having to gather data for all dividends and closing prices. Yahoo! Help has a good explanation and example calculations of how they calculate the adjusted close price. Now I know that Yahoo! Finance doesn't always have the best information but it's the best that I can get to work with. All returns are calculated through close on September 9, 2012 to be consistent with my previous post.
Monday, September 10, 2012
To calculate your portfolio return you enter your cash flows like so.
Sunday, September 9, 2012
I reached a small investing milestone of a $40k FI portfolio value. Hoping that continues to increase every month.
Check out My Portfolio here.
Saturday, September 8, 2012
The Next Bubble is in Canada, and It Will Affect Everybody
The Dividend Guy had a great post about the potential debt bubble forming in Canada. It's eerily similar to how the US personal debt/income issues led us into the financial crisis and has only gotten worse there.
Appreciating The Small Steps Of Dividend Growth Investing
Dividend Growth Machine had another great article outlining dividend growth investing and compound income in general. His main point is to focus on the end result and to not get discouraged by the slow beginning.
How to retire with dividend stocks
Speaking of staying focused on the end result, Dividend Growth Investor posted about how to retire with dividend stocks. It's not a get rich quick scheme by any means, but it is one of the most stable ways to generate solid returns.
Money Down the Drain: Water Conservation and Your Wallet
The Simple Dollar wrote about conserving water in your house and how just a few little changes can save you money. And just think of what that money could turn into if you invest it.
Smuckers Looks Fairly Priced
Dividend Monk ran the J.M. Smucker Company through a stock analysis and determined it was fairly valued. Check out the post to see his reasonings.
Dividend Income Update - August 2012
We finally got a dividend income update from Dividend Mantra. I'm glad to see that he's back from his summer hiatus and posting again. His blog was a big inspiration for me to start mine.
Friday, September 7, 2012
Thursday, September 6, 2012
|Strike Price||Option Price||Cost Basis if Exercised||YOC if Exercised||Discount to Fair Value||Total Return if Expires||Annual Return if Expires|
I really like the $27 put option because you get a solid YOC entry point as well as a great option premium if ADM is trading above $27 come December 22. It wouldn't surprise me to see the option expire come December so that could be the best way to go, with it currently trading on par with the strike.
If I had the cash on hand I would sell at least one of these puts today, most likely the $26 put to help lower my cost basis on the shares. The $27 put doesn't give as much help since my cost basis on the 35 shares I bought last month is $25.96. The $26 put would lower my total basis to $25.28 and increase my YOC to 2.77%. Which is a good range to be in. This would also get my position to be in at a 19.27% discount to fair value.
Tuesday, September 4, 2012
Saturday, September 1, 2012
There were 2 new purchases this month with 35 shares each of Walgreens (WAG) and Archer-Daniels Midland (ADM). These will add an extra $38.50 and $24.50 to my annual dividends before dividend increases or reinvestment.