TheMoneyMadam’s 2011 and 2012 Dividend Machine portfolio
performances are provided in the tables below.
These two portfolios provide valuable data for income investors.
2011 DIVIDEND MACHINES PORTFOLIO – 52 Stocks
After the stock market meltdown in 2008/2009, the
market was just beginning to get legs when I retired and then started my 2011 dividend
machine project. Stock prices are up
significantly since then, so I am not surprised that the stocks purchased in the
2011 portfolio gained over thirty percent. Amount invested: $207,336 value
as of last Friday $271,239.
I wanted to make sure this dividend portfolio
provided more income than a 10 yr. US Treasury and I am happy to report we beat
that by a large margin: 2% versus 4.28%.
This portfolio provides annual income of $8,875.
See the table below to review the 2011 dividend machine
portfolio status as of 5/10/2013 then look at the 2012 portfolio.
2011 DIVIDEND MACHINES Bought 100 Shares
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Basis
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$ 207,336
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Current Dividend Income
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$ 8,875
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Value
|
$ 271,239
|
Yield on Basis
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4.28%
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$ Gain
|
$ 63,903
|
Yield on Current Value
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3.27%
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% Gain
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30.82%
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Stock Prices Updated 5/10/2013
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Stock Quotes Provided by MSN Money
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2012 DIVIDEND MACHINES PORTFOLIO – 48 Stocks
In 2012, stock prices had grown more than legs. Stock price increases make your new
investments costs more. Moreover, every
one of us is searching for income so it is not surprising that dividend stock
prices increased. Demand for income
stimulates increased cost of income.
In spite of the increased cost of these stocks, the 2012
dividend machine portfolio is worth more than the basis by 18%. Amount invested: $208,821 value as of last
Friday 5/10/2013 $246,641.
Like the 2011 portfolio, income beats the 10 yr. US
Treasury by a lot (1.75% versus 3.88%) but you can see that the increased cost
basis has cut into our income. This
portfolio provides annual income of $8,110 per year.
See the table below to review the details.
2012 DIVIDEND MACHINES
Bought 100 shares
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Basis
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$ 208,821
|
Current Dividend Income
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$ 8,110
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Value
|
$ 246,641
|
Yield on Basis
|
3.88%
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$ Gain
|
$ 37,820
|
Yield on Current Value
|
3.29%
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% Gain
|
18%
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Stock Prices Updated 5/10/2013
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Stock Quotes Provided by MSN Money
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CURRENT INCOME INVESTING
Cost of income is going up. In 2013 every company that provides income
costs more. You have few
alternatives. Periodically bonds rattle
their sabre but right now even junk bonds are expensive.
What should you do?
I no longer have to manage anybody’s money but my own and this is not
advice. I can only tell you what I do
and that is to continue to invest in well selected companies.
Every company still has to meet my minimal four
criteria. (To review: those criteria are
a dividend yield of 3% or more, dividend increases every year since at least
2007, earnings greater than dividend and d/e ratio equal to 1 or less or equal
to industry standard.) However, I am investing
in fewer companies and expecting closer to 3.5%.
I sell calls on the companies with enough volatility
to create more income. Selling calls in
an up market means that my stocks get sold.
That capital gain provides the money for further investing. When bonds are competitive, I will buy them,
but not yet.
The 2013 DIVIDEND MACHINE PORTFOLIO is developing;
we will see how it fares. There are no guarantees just good disciplined
income investing.
TheMoneyMadam
