Wednesday, December 23, 2015

Time off & Happy Holidays

I've taken the last two weeks off from work spending some good times with family and friends in North Carolina. It has been quite a busy year in terms of my work, family life and investing so it is good to take a breather or two and reflect on the year. 

So far, the trip has been very relaxing. I don't have my computer. (I’m typing this on my phone so this won't be a long update.)

Monday, December 14, 2015

Recent Buy (Tax Deferred) - EV


I recently added EV to my tax deferred 401k account. This is not fresh capital. I recently liquidated one of the funds for DGI investments.

Details of Purchase

Today, I bought 118 shares of Eaton Vance (EV).

Action
Security
Price
Quantity
Amount
Buy
EV
$31.49
118
3715

This purchase increases my forward annual dividends by $125.08.

Thursday, December 10, 2015

KISS Principle for Investing

Many of you already know the KISS acronym which stands for “Keep It Simple, Stupid”. It was something that was started by the US Navy in the 1960s. In the technology area, it was also frequently used for software and hardware design.


“The KISS principle states that most systems work best if they are kept simple rather than made complicated; therefore simplicity should be a key goal in design and unnecessary complexity should be avoided.”

This principle makes sense for investors. If you look at the financial meltdown in 2008, the complexity of the financial products (e.g. CDO (collateralized debt obligation) and CDS (credit default swap)) must have contributed to problems by misrepresenting some of the risks.

Tuesday, December 8, 2015

Recent Purchase (Tax Deferred) - WMT

I recently added WMT to my tax deferred 401k account. This is not fresh capital. I recently liquidated one of the funds for DGI investments.

Details of Purchase

On Tuesday, I bought 65 shares of Walmart (WMT).

Action
Security
Price
Quantity
Amount
Buy
WMT
$58.80
65
3822

This purchase increases my forward annual dividends by $127.40.

Monday, December 7, 2015

Where to find DGI stocks? Follow the Herd


Sometimes, finding good Dividend Growth (DGI) stocks can be challenging - especially for beginners. I like to use David Fish’s CCC list with my screener to look for DGI stocks. Obviously, Mr. Fish has put a lot of work in putting together this wonderful spreadsheet every month.

I also like to “Follow the Herd”. 

Friday, December 4, 2015

Weekly Purchase 12 - YUM


It's December already, which means I need to save for my property tax and insurance payment for my house in January. My plan is to limit my purchases using fresh capital until the beginning of next year. With the sharebuilder plan, I had to make the purchase decision on Monday so the capital was already allocated in November. Confused yet?

If the market goes south this month, I may need to dip into my war chest/emergency funds to make some trades, and then use next year to refill. Let's see how it goes. 

My purchase this week is on YUM. I talked with my son recently on YUM, and he had no idea what it was about. However, when I mention KFC, Taco Bell and Pizza Hut, his face lit up. So, we have brand recognition with this company!



Details of Purchase


On Tuesday, I bought 15.19 shares of Dover (YUM).


Action
Security
Price
Quantity
Amount
Buy
YUM
$73.85
13.4882
996 + fees


This purchase increases my forward annual dividends by $24.82.

Tuesday, December 1, 2015

November Summary



Another month! November flew by just like that. The markets were pretty steady so it was difficult to hunt for bargains - though I did snatch up some Thanksgiving shopping bargains at Walmart (WMT) and Target (TGT). With the extended sales, it seems that people are adjusting. I don't see the crowds that I used to see and you can buy virtually everything online. However, a lot of people are buying TVs - though I don't know if it means anything at all. I did read recently that the wealthy watches 1 hr of TV compared with almost 5+ hrs for the Not so Wealthy. And what they watch is mostly news compared with reality programs.

More wealthy folks habits can be found here:

Sorry, I don't have any information on blogging habits of the rich and wealthy.

Anyway, back to November.

Wednesday, November 25, 2015

Weekly Purchase 11 - DOV

For this week's sharebuilder purchase, I added to my existing position in Dover (DOV).


DOV appeared in the November screen which looks for M*/S&P BBB+ rated companies with lower than average P/Es and higher than average yields. I bought DOV a few months ago and I am averaging down on my existing position.


Details of Purchase


On Tuesday, I bought 15.19 shares of Dover (DOV).


Action
Security
Price
Quantity
Amount
Buy
DOV
$65.53
15.19
1000


This purchase increases my forward annual dividends by $25.52.

Monday, November 23, 2015

Recent Purchase (Tax Deferred) - HSY



For my tax-deferred portfolio, I bought 20 shares of Hershey (HSY). Hershey has been on my watchlist forever since I really like it’s business model. I expect this company to be around for decades to come - which is perfect for my 401k account.


Details of transaction:


Action
Security
Price
Quantity
Amount
Buy
HSY
$85.10
20
$1702.2 +fees


The yield is close to 2.72% which increases my forward yearly dividends by $46.60.

Friday, November 20, 2015

Recent Purchase (Tax Deferred) - ADM



After transferring some of my mutual funds over to my 401k self directed account, I initiated my first trade. I bought 100 shares of ADM. Since the the account is new, the interface is not familiar, it was a learning experience as well. Fortunately, no hiccups.


Details of transaction:


Action
Security
Price
Quantity
Amount
Buy
ADM
$37.00
100
$3700 +fees


The yield is close to 3.10% which increases my forward yearly dividends by $112.00.


My plan for the 401k self directed account is just to let my investments sit there for a long time. I am leaning towards stable companies with a long history of dividend growth, stability and ability to grow earnings. ADM seems to fit this criteria quite well. I also have some REITs to load up due to the advantages of tax deferral. Like my taxable account, I plan only one trade once per 1 or 2 weeks.

Tuesday, November 17, 2015

Portfolio Addition



Currently, my blog summarizes the activities in my taxable portfolio. As some of you know, most of my capital is stashed away in my tax-deferred 401k which I started when I was young and naive. The investments in my 401k are index & mutual fund based. Back then, I didn’t really know what to do, but I knew I had to invest. So, I picked a few funds.

Overall, the fact that I invested early, and continue to invest regularly (e.g. money automatically deducted from my paycheck, maxing out the limit, employer contribution etc), I did okay. It went up and down with the market. I ended up with some gains. However, I am making my asset managers very happy with the fees. While the cost of the funds are fairly low, they average out to be approx. 0.4%~0.5% of my portfolio total. So every year, I am essentially paying $400~$500 for every $100,000 in my account. Ouch!

Friday, November 13, 2015

Weekly Purchase 10 - ADM


Today, I initiated a new buy on ADM. Normally, I would wait until Monday to look at the market and use the weekly Sharebuilder plan to buy on Tuesday. I bought early because the ex-dividend date is November 16th and I wanted to capture dividend payment in December. Moreover, ADM appeared in my screen for the last two months.


Details of transaction:


Action
Security
Price
Quantity
Amount
Buy
ADM
$38.28
26
996 +fees


The yield is close to 2.96% which increases my forward yearly dividends by $29.12.

Wednesday, November 11, 2015

Recent Purchase - CMI



For some strange reason, my sharebuilder order was not processed on Tuesday. I must have not saved my order. Anyway, I had to pay a little more on the transaction fee which is not too bad when I compare with the fees I pay for my mutual funds in my 401k.


Based on my November screen and watchlist, I have a few companies to invest.


Today, I bought 10 shares of CMI.


Action
Security
Price
Quantity
Amount
Buy
CMI
$101.00
10
1010 +fees


The yield is close to 3.81% which increases my forward yearly dividends by $39.00.

Tuesday, November 10, 2015

November Screen





Again, I've been very late with my monthly screen. Work had been crazy and I didn't have much time to focus on the blog.


For this month’s screen I followed a similar approach to my previous months. I've relaxed the criteria slightly to capture more companies for consideration.


I have used the CCC list and filtered on the companies with above average yield and below average PE.


My Screening Criteria:
  • Yield > 2.0%
  • Yield/10 Median Yield > 1.1
  • Chowder > 6
  • PE/5 Median PE < 1.0

Saturday, November 7, 2015

Conversation with Son - Part 1



One if the original reasons for the blog is for me to learn the DGI investment process and to come up with a long term strategy which I can one day pass on to my son - portfolio and all.


I also wanted to start teaching him the basics of investing. Since he is only 8, this is a little difficult.


Several weeks ago, I introduced him on the importance of saving, and then investing what you save. For example, I told him that you can buy small pieces of McDonald's, and over time, MCD will pay you back a small amount each time (as dividends). If you wait long enough, the dividends can be more than the original investments.


He understood the the savings part - he is already saving his pocket money, birthday money etc. But I wasn't so sure about the investing part. Anyway, he soon went back to his Minecraft game. (I am not sure why all the kids are playing this game!) At least it was a start.