One Piece At A Time | Week Ended 3/13/2020

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.


The markets continued to see high volatility and further downside.  Last week was especially crazy with Thursday and Friday each seeing 10% moves, one up one down.  There were also multiple times throughout the week where the markets triggered the circuit breakers.  To say it was a crazy week would be an understatement and I fully expect that to continue.

Even though the markets were volatile I still put some more cash to work although I significantly scaled back the amount compared to the last 2 weeks of February.  In hindsight, I wish those capital amounts were swapped.

I put a total of $3,797.86 to work and increased my forward 12-month dividends by a total of $67.10.  That's just an average yield of 1.77%, but I believe the quality of these businesses is quite high.

The $340 that I put to work in my FI Portfolio carries a YOC of 3.42%.

The 52-week high isn't necessarily a good judge of the value of the underlying business and neither is the 52-week low.  However, it does give a reference point if you believe that markets are generally efficient, even if they aren't all the time.

All of the purchases that I made were well off their 52-week highs.  On average my purchases were made at prices that were 27.5% off their respective 52-week highs.

The valuations still don't look like bargain basement valuations; however, they are still better than they were and generally more enticing.  

Looking forward to this week some of the companies I'm looking at adding to my positions are Altria ,Cisco, 3M, Pepsi, Ross Stores, Disney, Pfizer, Stryker as well as the companies that I added to last week should the selloff continue.  Of course, that's pending the way the markets behave and what opportunities get opened up.
   




  

My FI Portfolio's forward 12-month dividends increased to $8,109.84 with my FolioFirst dividends at $101.99  My Roth IRA's forward dividends climbed to $664.15 while my Rollover IRA's dividends increased to $2,611.73.  My taxable accounts can expect to produce $8,211.83 over the next year with all accounts providing $11,487.71.

Did you make any purchases during last weeks stock market decline?  What businesses are on your radar to add?  Do you think the selloff will continue or is the worst of it behind us?