02-15-2014, 08:03 PM
I keep 3 stock lists.
First is the stocks I own. Yay! Lots of dividends, which is what I want.
Second is the stocks I do not own but would like to own, but only at the right price. I have a minimum current yield hurdle -5% - which I rarely violate. Yes this is a high yield but I am retired and need the income. At some point I will explain why, for a retiree, high current yield is much more valuable than low current yield + high DGR. I have a spreadsheet that models this relationship, if anyone is interested.
Third is the stocks I own and of which I want more, and how much more in $s.
Two weeks ago we had prime and possibly historic buying opportunities in two, both that I own and one that I want more of. These were MO and PM.
I used the RSI (relative strength index) technical indicator to identify, as close as one can in these things as they happen, the best time to buy both. For those who are not familiar with the RSI, readings below 20 are short term highly oversold, and readings above 80 are short term highly overbought.
On Feb 3, the RSI of MO dropped to 18.32. This was by far the most oversold MO had been in more than 5 years, including the 2008-2009 crash. I had some cash available, and my MO allocation was not as large as I wanted, so I bought.
On the same day, Feb 3, the RSI of PM dropped to 17.72. At the low that day, the yield was within a micrometer of 5%. PM has never been that oversold. If my allocation to PM were not full and then some I would have bought more. I bought most of my position in PM when the market crashed in Aug-Sep 2011, when the yield did rise to 5%.
I am happy to share how I combine fundamentals with technicals. I am retired and collecting dividends, and current income is my focus, but am not yet spending all of them. So far I am reinvesting the majority. If you look at my profile on SA you will see that I have a significant allocation to mREITs and BDCs. I reinvest the dividends opportunistically into my 2 stock lists mentioned above, which do not include the mREITs. I continue to hold a significant percentage in mREITs and would be happy to discuss them.
First is the stocks I own. Yay! Lots of dividends, which is what I want.
Second is the stocks I do not own but would like to own, but only at the right price. I have a minimum current yield hurdle -5% - which I rarely violate. Yes this is a high yield but I am retired and need the income. At some point I will explain why, for a retiree, high current yield is much more valuable than low current yield + high DGR. I have a spreadsheet that models this relationship, if anyone is interested.
Third is the stocks I own and of which I want more, and how much more in $s.
Two weeks ago we had prime and possibly historic buying opportunities in two, both that I own and one that I want more of. These were MO and PM.
I used the RSI (relative strength index) technical indicator to identify, as close as one can in these things as they happen, the best time to buy both. For those who are not familiar with the RSI, readings below 20 are short term highly oversold, and readings above 80 are short term highly overbought.
On Feb 3, the RSI of MO dropped to 18.32. This was by far the most oversold MO had been in more than 5 years, including the 2008-2009 crash. I had some cash available, and my MO allocation was not as large as I wanted, so I bought.
On the same day, Feb 3, the RSI of PM dropped to 17.72. At the low that day, the yield was within a micrometer of 5%. PM has never been that oversold. If my allocation to PM were not full and then some I would have bought more. I bought most of my position in PM when the market crashed in Aug-Sep 2011, when the yield did rise to 5%.
I am happy to share how I combine fundamentals with technicals. I am retired and collecting dividends, and current income is my focus, but am not yet spending all of them. So far I am reinvesting the majority. If you look at my profile on SA you will see that I have a significant allocation to mREITs and BDCs. I reinvest the dividends opportunistically into my 2 stock lists mentioned above, which do not include the mREITs. I continue to hold a significant percentage in mREITs and would be happy to discuss them.