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My portfolio
#1
Though I've been an indexer for the first few years of my career, I've been reading up and investing in a few individual companies and peer-to-peer lending.

My dividend-focused portfolio includes:
**Long-term holdings as of 5/5/14**
ARCP
K
KMI
KO
MCD
TGT
UL
WMT

**Short-term positions**
DVY - acts as a parking lot, of sorts. This is where I plan to put new monies while accruing enough to make good-sized purchases since it could take a couple months to achieve enough capital to buy stocks with less than 0.5% commission. The expense ratio is 0.40% and the dividend rate is ~3.0%, so it's not too shabby.

LendingClub - I know this isn't really a "short-term" holding, since the investments are held up for 3-5 years based on the loan, but with a 15.0% APY (for now..), I feel comfortable with the balance accrued, and any payments received will go toward other positions.

ESPP - Company stock @ 15% discount - IMO a no-brainer for short-term holding for a sweet return but I have to hold for 3 months. Though the waters have been pretty stormy for my company, they expect things to turn around this year. Trading between $50-65 but has > 2.3% yield, so it's not a terrible short-term holding. If the stock price stays stable, it should give about 10% return per sale.

IJT - iShares small-cap growth fund. This will remain a small position, and I will not be adding more to it unless it's at an exceptional discount compared to my cost basis. I know this really isn't a great holding for dividend strategy, but I hope that it can post some big gains in the next couple years to put toward other investments. This is also a no-commission ETF through Fidelity.

Watch List - PEP, DPS, OHI, O, PM, PG, T

Any thoughts/critiques are very much welcomed.
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#2
My wife told me the other night that I don't know when to shut up. Rolleyes

(04-30-2014, 03:56 PM)WRXodus Wrote: DVY - because the majority of my investments are with Fidelity and DVY trades free, though it has a 0.40% ER. I plan to use this for the majority of my cash until I can amass enough to make big enough purchases to make my expenses < 0.50%

ESPP - Company stock @ 15% discount - IMO a no-brainer for short-term holding for a sweet return but I have to hold for 3 months. Though the waters have been pretty stormy for my company, they expect things to turn around this year. Trading between $50-65, but has > 2.0% yield so not terrible.

LendingClub - I've been investing with LC since 2011 and getting ~15% return. I'm still unsure if I should reinvest these returns here or put elsewhere.

I'm not a fan of any mutual funds or ETFs for domestic securities but you could do worse as a parking spot. Don't know how much you can accumulate over whar time period so maybe it's a best way for you to keep your finger in the market. The other two I have no clue about.

(04-30-2014, 03:56 PM)WRXodus Wrote: MCD, KO, WMT, TGT - these are my first real long-term holdings. I've purchased these through Loyal3 because of their $0 commission..which is great because I only have $25 in each so far. I plan to add to these every month until achieving a full position.

I like those choices.

(04-30-2014, 03:56 PM)WRXodus Wrote: IJT - iShares small-cap growth fund. I know this really isn't a great holding for dividend strategy, but I hope that it can post some big gains in the next couple years to put toward other investments. This is also a no-commission ETF through Fidelity.

No commission but still annual expenses, n'est pas? I think I wrote somewhere around here how I rode MSFT, CSCO & YHOO up and back down through the dot.com mania. I bought YHOO with a P/E greater than 90 thinking I'd make a quick killing. It killed me more than the other two. Hope is not an investment strategy. The problem for me is, if you happen to hit the cycle right, you can make a real good return and think it will keep repeating itself. Maybe you can -- I couldn't and can't without a lot of angst.

(04-30-2014, 03:56 PM)WRXodus Wrote: Any thoughts/critiques are very much welcomed.

See the first sentence of this post. Cool
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan


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#3
(05-02-2014, 12:28 AM)Dividend Watcher Wrote: My wife told me the other night that I don't know when to shut up. Rolleyes

Hah I'm the same way, so no worries. I appreciate the feedback.

With the 3% yield, DVY has been working pretty well the couple of months I've held, but I will definitely put that cash to better use when I can get the trade commissions down below 0.35%. DVY charges 0.40%. Not as good as Vanguard's VIG at 0.10%, but I can live with it for the time being. Smile

To give you an idea, I can only save about $200/mo so transactions costs would for sure eat me alive.

I went with IJT because I'm a bit of a gambler. In the unlikely scenario I keep it, I'll make sure to keep it at < 1/2 position size. I have absolutely terrible micro-cap picking skills so I just decided to have some of the excitement but with diversity. Heh I sold my last pick for a 3% loss, which then went on to gain 100%. /uberfacepalm
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#4
(05-02-2014, 07:12 PM)WRXodus Wrote: I can only save about $200/mo so transactions costs would for sure eat me alive.

That's still a nice amount to invest monthly. I would find about five to eight DG stocks which offer DRIPS' & OPP plans (with No fees). Each company has its own min investment. Set up your accounts and invest in all or some each month or in the ones which have dropped in price during the month.

You'll see your small portfolio grow faster than almost any other method, with next to no work involved.
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#5
$200/month, epecially at your age, is nothing to sneeze at. I think you've got a bright future.

I agree with cannew's idea with one caveat -- can you find enough no-fee DPP/DRIP plans in companies you want to invest in? With Computershare being the agent for a lot of plans, I'm seeing more and/or higher fees tacked on with more companies. I think we've mentioned that elsewhere here.

Another strategy would save save up 3-4 months investment capital and then buy one company. Yes, you'll lose couple months of possible compounding and the return on cash stinks but in the long run, you won't even notice. Same with the high fees. Sure, it would be about 1.4% give or take a couple hundred basis points but again, in the long run, it will average out a lot lower if you hold for the long term. No, the transaction fees will NOT eat you alive on a one-time transaction and you hold for the long term. Paying a 5% load or 0.5% management fee for the rest of your long life will. Why the recurring fees hurt is because as your account value gets bigger, so does the actual fee you pay. Don't cut off your nose to spite your face.

Because my wife's portfolio is so much smaller than mine, especially a few years ago as I was just starting to build her account, there were many times when I took a $500 or $600 tranch. The way I looked at it is the 1st and probably part of the 2nd dividend payment covered the transaction fee, every dividend after that was hers for the rest of her accumulation life.

There will come a time when you'll be buying in larger lots. In the meantime, those reinvested dividends keep adding up.
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan


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#6
Thanks guys for the encouragement and suggestions!

Thankfully, I can get 8-9 solid dividend stocks, so that'll work for the time being.


(05-04-2014, 06:39 PM)Dividend Watcher Wrote: Another strategy would save save up 3-4 months investment capital and then buy one company. Yes, you'll lose couple months of possible compounding and the return on cash stinks but in the long run, you won't even notice. Same with the high fees. Sure, it would be about 1.4% give or take a couple hundred basis points but again, in the long run, it will average out a lot lower if you hold for the long term. No, the transaction fees will NOT eat you alive on a one-time transaction and you hold for the long term. Paying a 5% load or 0.5% management fee for the rest of your long life will. Why the recurring fees hurt is because as your account value gets bigger, so does the actual fee you pay. Don't cut off your nose to spite your face.

That sure is some powerful stuff. It'll feel great to not have to worry about paying annual fees!
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#7
Updated to include a couple new position changes.

-Purchased UL and K through Loyal3
-Purchased ARCP in Fidelity taxable account.

With thanks to DW reminding me that the commissions are a one-time deal and will be reimbursed through dividends, I felt much more comfortable investing outside Loyal3.

To stick to the game plan and keeping taxes in mind, the ARCP purchase was made using proceeds from selling some of the DVY (ETF) holding by choosing the lots with the smallest capital gains. The very first dividend from ARCP will cover the commission, so that's comforting. Since the ex-dividend date is tomorrow, I figure that today is the best day to at least get the ball rolling. ARCP is now my biggest holding so I will not be reinvesting dividends and the proceeds will go toward rebalancing in other stocks.
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#8
Do you have a Roth IRA? It's a great way to shield yourself from the income tax consequences of collecting dividends from REITs.
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#9
I do. Up until the last few months, I've been an index investor and I am starting up the dividend investing approach a little at a time. So far, I've felt comfortable making changes in my taxable accounts, but I don't yet feel comfortable making changes in the Roth and Traditional IRAs.

Index investing was so easy so switch to because it's very much set-and-forget (besides rebalancing, of course). However, I've been feeling very bored with it because I like have some more hands-on experience, but my stock-picking skills have seriously lacked in the past because of impatience and spontaneity. I guess you can say that I've had some PTSD from previous failures that has me nervous to go all-out individual stocks, especially in accounts with limited yearly deposits.

I'm sure that once I get more comfortable with this paradigm shift I'll start being more tax-focused, but for now it's not a big issue because ARCP will only give off about $120/year.
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#10
(05-05-2014, 11:40 AM)WRXodus Wrote: ... but my stock-picking skills have seriously lacked in the past because of impatience and spontaneity. I guess you can say that I've had some PTSD from previous failures that has me nervous to go all-out individual stocks, especially in accounts with limited yearly deposits.

   
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“While the dividend itself is merely a rearrangement of equity, over time it's more like owning an apple tree. The tree grows the apples back again and again and again, and the theoretical value of the tree doesn't change just because of when the apples are about to fall.” - earthtodan


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#11
Haha DW yeah, pretty much .. Sad at least I've learned my lesson!
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#12
Purchased 46 shares of KMI @ $33.50, commission included
Another faction of a share purchased of MCD thanks to first dividend from ARCP and interest from LendingClub.
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