One Piece At A Time | Week Ended 11/22/19

Zero | Commission | Purchase | Investing | Dividends | Financial Independence

My investment strategy has changed a bit now my that my brokerage firm, as well as most others out there, have moved to ZERO commissions.  I had typically tried to purchase in dollar amounts that put commissions at 1.0% or less.  I've always wanted to implement, at least partially, the dollar cost average method but commissions prohibited me from pursing that.  However, now it's very feasible and reasonable to do so. 

My focus has always been on quality businesses, but the problem was typically buying shares at good valuations, often I had to settle for good enough.  The longer that I've been investing, the more that I've come to realize just how powerful hitching your investment wagon to great companies can be.  That's why I've shifted my focus to dollar cost averaging to build up my positions; because the larger your purchases the more attention that needs to be paid to valuation and vise versa.

I'd still prefer to do larger scale purchases, but the problem is that quality businesses don't often trade at good valuations.  In general valuations aren't exactly cheap; so I'll just keep building up my stakes in great businesses.

$0 Commission | Recent Buy | Dividend | Investing

In total I invested $1,757.15 and boosted my forward dividends by $44.68.  That's an average yield of 2.54% across all of the purchases.  For my FI Portfolio I invested $1,326.40 and added $39.76 in forward dividends or a 3.00% initial yield.

This week was much busier than the previous weeks in terms of number of purchases as well as the dollar amount invested.  I'm pretty excited to be back to investing again after a much too long hiatus.  But now that one car loan is paid off, the other a work in progress and an adequate emergency fund stored up I'm ready to get back to building up our portfolio.

In the 3 full weeks in November we've invested nearly $3,700 in fresh cash across our portfolios increasing our dividends by $87.

Many of the purchases have been dollar cost averaging into lower yielding, but faster growing businesses.  Although there's been a good helping of capital put into the businesses in the "sweet spot" of dividend growth investing especially this past week.  

Stocks | Investing | Valuation | Dividend Growth Investing

The valuations for last week's purchases look okay.  Nothing to get too excited about that I would want to invest in large size, but nothing that seems too out of whack either.  In other words I believe that most of the purchases were made in the range of fair value, typically on the higher end, but most importantly are quality businesses.

Looking at dividend yield theory, Altria was the best value purchase with a "fair" price for shares 65% higher than what I purchased at.  

Of course Microsoft was the worst purchase when using dividend yield theory since I purchased shares at a 34% premium to the fair price according to DYT.  Although the Microsoft purchase was definitely not made for current dividends with an initial yield of just 1.37%.

Overall I'm pretty happy with the dollar cost average purchases that I made last week.  While I like getting to consistently move the portfolio and dividends forward, I also do need to slow down the pace a bit.  I'd like to get at least $5-10k of cash built up in the account and ready to deploy for when the markets act crazy again. 


My FI Portfolio's forward 12-month dividends increased to $7,770.11 with my FolioFirst dividends at $101.09.  My Roth IRA's forward dividends remain at $629.93 while my Rollover IRA's dividends increased to $2,332.08.  My taxable accounts can expect to produce $7,871.20 over the next year with all accounts providing $10,833.21.

Are you doing more dollar cost averaging now that most every brokerage firm is at $0 commissions?  What do you think of my purchases from last week?


  1. I wish we had free trades here in Canada :(

    Good to see you accumulating those shares, JC. Im getting more and more interested in MO and PM -- but just cant shake the feeling of the risk associated with massive litigations brought against them worldwide.


    1. R2R,

      I'm surprised that the $0 commissions hasn't moved north of the border yet, but I imagine it will eventually. How long or was there much of a lag when the cut to around $5 commissions happened across the US?

      Litigation risk is always the big concern regarding MO and PM. Although I think less so with MO. IIRC there was a stipulation that the tobacco business had fairly limited liability moving forward during the big agreement that happened in the 90s. Although PM is certainly open to the possibilities.

  2. PiP -

    You are on a tear, one mission war path! Loving it.


    1. Lanny,

      Last week was pretty busy, but so has most of October and November. It feels good to get back to investing and moving forward again. I do expect to slow things down some for the rest of the year though due to both higher expenses, damn property tax bill, and also wanting to build up some cash for large size purchases whenever the markets do selloff again.

      All the best.


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