11-09-2021, 06:25 PM
(11-04-2021, 08:57 PM)ken-do-nim Wrote:Ok I see what you mean. I think it's moreso that I like to hold on to my shares and never sell them unless I am transferring from one stock to another. My portfolio isn't one geared for retirement; it's a taxable account where I eventually plan on using only dividends as supplemental income, so of course the more shares I have, the more dividend income I can earn. It's probably our difference in stages and objectives why our perspectives may differ.(11-04-2021, 05:11 PM)Navi Wrote:(11-02-2021, 06:26 PM)ken-do-nim Wrote:(11-02-2021, 05:44 PM)Navi Wrote: I'm surprised that there is so much movement in a dividend portfolio. I expect dividend stocks to be purchased and held for many years unless they start to underperform (either stock price stays below the average for too long, or dividends get slashed). Also, these yields are quite high. I expect the long term dividend stocks to be around 3 or 4%. Is this a unique approach for you in regards to dividend investing?
Hi Navi,
I invest in 6 categories of equities:
1. Triple-leveraged Index ETFs (ex: TECL, SPXL, SOXL)
2. High growth stocks, tiny to no dividend (ex: Tesla, Nvidia)
3. High growth stocks, < 1% dividend (ex: Microsoft, Apple, Sherwin Williams)
4. Moderate growth stocks, dividend between 1 and 3% (ex: Oracle, Johnson & Johnson, Seagate)
5. Low growth high dividend stocks, with a dividend between 3 and 5% (ex: LyondellBasell)
6. Income stocks, dividend north of 6%
The funny thing is many of my income stocks are absolutely crushing growth as well. OXLC year to date is +53.09%, with a 9.62% yield to match, which will be raising in January. HTGC is +25.90% year-to-date with aggressive dividend increases. ARCC is +28.35% year-to-date with a dividend raise this year. RQI is +40.03% year-to-date, which has caused the yield to drop below 6% because they haven't raised the dividend. CIM is +56.81% year-to-date with dividend increases (might be my stock of the year if I had discovered it earlier).
Of course these funds aren't going to beat the S&P 500 index long term, but 2021 has been a fun ride.
Oh nice! Quite diverse in terms of the dividend spread. Funny you mention LyondellBasell, as they are one of my long term equities. Do you just hold on to them simply for dividends? Or are you holding the growth stocks in hopes that you get both capital gains as well as dividends someday? I would only look to growth stocks for capital gains, but it's not a "gift that keeps on giving" so to speak. Once you tap into the gains, it's gone. Curious as to the role it plays for you.
I'm not sure I understand the question, but in general I hope for both price growth and dividend growth. The poster child of my portfolio is AVGO. It is up 29% year-to-date, and should be raising their dividend for Q4 because they like to keep it around 3%.
> Once you tap into the gains, it's gone
Not sure what you mean by that either. Let's say you are retired and have determined you can live on 5% of the portfolio's value annually. That 5% can come from any combination of dividends and share sales. As long as the portfolio is growing higher than 5% on average, it will continue to build even while you are in the drawdown phase. I prefer dividends because they are generally dependable and selling shares stops being effective when the market is down for multiple years in a row, but many, many people sell a share here, a share there, to fund their retirement or supplement their budget. Anyone drawing down from a 401k annually is selling shares.