Thursday, March 31, 2016


Just collected the end of the month dividends for March 2016 and did a monthly and quarterly comparison with 2015.  Am very pleased to report that dividend income is up 66% for the month of March 2016 when compared to March 2015.  However, I was blown away to discover that first quarter earnings for 2016 were up over 90% when compared to the first quarter of last year!  My goal for this year is to increase dividend income 50% over last year.  At this point, I'm thinking I may have set my target too low.  That's O.K. though, I do want to set attainable goals and stick with my investment plan.  So far it's been working quite well, even in the choppy markets we've experienced since the first of the year.

I sat down earlier this week and reviewed my portfolio.  I came up with an ambitious 3 year stock purchase plan that will not only boost dividend income significantly, but I believe it will put me in a better position to boost capital gains as well.  Since the plan calls for buying shares in bigger lots, it will also help keep commission costs down.  While I do plan to purchase more shares of some of my stock and bond funds, this plan is directed more towards boosting my stakes in individual stocks.  I'm pretty excited about the whole thing.  I think it's a good move forward and will greatly enhance my investment portfolio.  The first stock purchases under this new plan go through next Tuesday.

Wednesday, March 23, 2016


With the horrible news of terrorist attacks in Brussels the market took a tumble today.  I'd expected to see the recent rally end anyway, but this tragic event just precipitated the matter.  After reviewing my portfolio, I decided to tweak my investment plan for what I believe will be a prolonged drop, if not an actual bear market.  Since the true performers in my portfolio are all individual stocks, I'll keep reinvesting the dividends in those, increasing my holdings and reducing average price per share as the stock prices drop.  For the stock and bond funds purchased mostly for their monthly dividends, I'll be taking all dividends in cash.  Cash dividends from funds will be accumulated to purchase additional shares of individual stocks.

This tactic will improve the quality of my investments overall and hopefully lead to better returns in the future as the market recovers.  I may see growth in monthly cash flows slow, but I intend to compensate for that by making cash purchases of more shares of my two best performing stock and bond funds.  Hopefully we'll see better leadership in Washington after this years presidential election and see some improvements in our economy and the war on terror.  

Monday, March 21, 2016


As a true believer in the power of stock investing for creating wealth, I've sometimes been guilty of purchasing very small numbers of shares to add to my investment portfolio.  I know all the arguments against such a move, such as commission costs, but I did it anyway.  On occasion, my cash available to invest has been so little that I was only able to purchase a single share of stock to begin with.  While that hardly seems worthwhile, as long as I'm convinced the company will do well and they have a history of raising dividends, I'm likely to do it anyway.

While this may go against all traditional wisdom of investing, consider this:  One share of Berkshire Hathaway purchased at the March 17, 1987 price of $290 per share would currently be worth over $200,000!  I was working in 1987 and could well have afforded to buy a single share of a $290 stock, so it's not beyond the realm of possibility that I could have done so.  Alas, I did not.  If I had, I'd most likely be retired right now.  

While you're unlikely to see this kind of gain, it's quite possible to end up with a great deal of money from buy just a few shares of stock and holding on to them, reinvesting any dividends along the way.  If it's a company with a history of growing dividends and earnings, you'll likely see the small investment turn out to be worth the effort.  I often think of the story of the woman who worked at Lily and purchased 3 shares of company stock.  She reinvested dividends and held the stock for the rest of her life and ended up with over $7 million!

So, if you can only afford to buy one share, is it worth it?  I'd say as long as it's a good company and you plan to hold on to it for a lot of years, then yes it's definitely worth buying.

Tuesday, March 15, 2016


Collected dividend payments today from CNP and MAIN, adding a nice sum to the total for March!  I like seeing these payments roll in week after week and to see the increase in number of shares owned through reinvested dividends.  I'm trying to decide whether to take some of the payments in cash from some of my riskier holdings and use the money to buy more shares in the less risky stocks.  I'm thinking that my portfolio is getting too heavily weighted toward the high risk side, need to balance that out some.  

One interesting fact I noticed when I was researching historical performance on AOD, in which I hold quite a few shares, is that performance was actually better over a 10 year period without reinvesting dividends than if you had reinvested them.  While most of the funds I hold I purchased for monthly income, not expecting any kind of stellar growth, it does make you stop and think about whether you'd be better off to take the cash and put it to work elsewhere.

Should I decide to take cash payments and reinvest them elsewhere, it would slow the growth in monthly cash flow and it would increase investment costs since reinvested dividends carry no commission charge.  So I'll probably do a mix, collecting some dividends in cash and reinvesting the rest.  That would cut down on volatility, keep cash flows increasing every month and keep costs down.

Saturday, March 12, 2016


I've owned shares of Pimco's High Income bond fund for quite some time now, but recently added additional shares as the price dropped.  Just filed my tax returns yesterday and decided to put half of the small refund I'm getting to work.  I'll be buying additional shares of PHK for my IRA account.  The new shares should start paying dividends in April 2016 and will boost monthly dividend income by a whopping 10%!  I'm pretty excited about this, since it's rare that I have enough free cash to invest at one time, to give myself such a good raise.  It's never a bad thing to increase monthly cash flow and when you increase it in 10% increments, it doesn't take long to add up to some serious cash.

For my taxable account, I've decided to buy shares of DEX, a global equity fund with monthly dividends.  While I hadn't planned on adding any new stocks or funds, I've decided to buy shares in DEX to make up for the loss of royalty payments from ROYT.  If ROYT should benefit from a recovery in the oil market and start paying royalties again, all the better.  But just in case, I'd like to have a back up to make up for the loss in monthly cash flow.

Collected another 3 dividend payments this week from CNP, LLY and PDLI.  Lilly and Centerpoint Energy have been holding their own performance wise, but I've seen a dramatic drop in PDLI since I purchased their shares.  Have no intention of selling as long as they continue to pay dividends.  My position is small and poses no great risk to my portfolio's performance overall, so I'll hold on to the stock.

Tuesday, March 8, 2016


I've been reviewing my portfolio's dividend performance from 2015 and comparing it to this year's performance.  If you've read any of my posts since the first of the year, you know monthly dividend income has been steadily increasing.  From what I've seen coming up for the rest of this month, monthly cash flow from dividends will set a new record for the month as well as the first quarter!  Pretty exciting stuff, especially considering the stock markets performance, or lack thereof, since the first of the year.

While reviewing payments received and the remaining dividends I'll collect this month, I just did a quick tally in my head.  Could do an exact calculation, but as I've mentioned before, I like to be surprised.  I stand to collect an additional 15 payments for this month, with some of those being the biggest monthly dividends.  I'll also see a nice increase in AOD's dividend from the new shares purchased around the first of the month.

I've finally gotten to the point that my investments, with reinvested dividends, are really starting to snowball.  They're building momentum, growing in size/total shares owned and the cash dividends are really starting to rack up.  As I was reviewing all this today, I couldn't help getting the feeling there's something phenomenal I'm overlooking.  Haven't quite figured out what it is yet, but I've got the feeling it's something very important that will boost returns even more.  If I figure it out, I'll let you know.  In the mean time, I'm very happy with the current performance and will continue my investment plan with no major changes for now. 

Thursday, March 3, 2016


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Wednesday, March 2, 2016


UVE is one of the original four stocks I purchased when I started to rebuild my investment portfolio.  I bought in at a very low price and was able to sell enough shares to take all my original cash back out of the stock.  Since then, I've held the remaining shares and reinvested all dividend payments.  I figure you can't really lose this way, since you're effectively playing with the house's money.

So imagine how happy I was to compare today's dividend payment with last year and find it had increased by a whopping 33%!  I work hard at my job and didn't get a raise from them at all during the past year.  But I'm really not too worried about that when I get these kind of raises from my investments.  This increase is entirely attributable to reinvested dividends.  While UVE did increase their dividend from ten cents to twelve cents per share last year, they'd already done so when I received the March 2015 payment.  With no additional cash out of pocket investments on my part, this truly is a great example of the "magic of compounding."

Tuesday, March 1, 2016


The month of March is off to a good start with five dividend payments!  As an added bonus, the stock market opened higher today.  Whether it will stay that way or not is anybody's guess.  Didn't purchase the new shares of PHK in time to capture the dividend for this month, so I'll see a big jump in the monthly dividend from them in April.  With reinvested dividends, I'm starting to see larger increases monthly cash flows.  The biggest jumps in income still come from cash investments, but eventually I expect to see more coming from compounding of reinvested dividend earnings.

The order I placed to purchase more shares of AOD will go through today.  I'll own the new shares in time to capture the dividends for this month, so I'll see an immediate increase in monthly payments from AOD.  AOD and PHK generate a substantial part of my monthly dividend income.  I sometimes think, if a person wanted to keep things really simple, you could just buy shares in two monthly dividend payers.  One good stock fund and one good bond fund and you'd probably do better than a lot, if not most, other investors.