Even though I did not own any KMI I'm definitely taking a closing look at quality and debt metrics since its meltdown.
Here is a good recent Seeking Alpha Article about buying quality companies. One of my favorite quotes from it (by John Tus of Honeywell) is:
"The economic downturn has underlined the importance of maintaining a good credit rating. During good times, ratings determine what you pay for capital. In bad times, they determine your access to capital."
Bad times came for KMI, and KMI's access to the debt/equity markets dried up so they couldn't continue paying their dividend.
Another lesson I learned after reading about people losing 25%+ of their income overnight is: portfolio position sizing. I only started DGI earlier this year, and so far I've been determining portfolio position size based upon the amount of capital invested in a company. In the future, I plan to base portfolio position size on the amount of income a company generates, and not the amount of capital invested.
Here is a good recent Seeking Alpha Article about buying quality companies. One of my favorite quotes from it (by John Tus of Honeywell) is:
"The economic downturn has underlined the importance of maintaining a good credit rating. During good times, ratings determine what you pay for capital. In bad times, they determine your access to capital."
Bad times came for KMI, and KMI's access to the debt/equity markets dried up so they couldn't continue paying their dividend.
Another lesson I learned after reading about people losing 25%+ of their income overnight is: portfolio position sizing. I only started DGI earlier this year, and so far I've been determining portfolio position size based upon the amount of capital invested in a company. In the future, I plan to base portfolio position size on the amount of income a company generates, and not the amount of capital invested.