DGI Portfolio Report for March 2016

By | April 5, 2016

This report provides an update on my holdings, performance, plans and thoughts for my Dividend Growth Investing (DGI) Portfolio. I started this portfolio with an initial funding of $100,000 and hope to use this portfolio to help me achieve financial freedom. I’m running this portfolio like a fund manager who runs a dividend growth fund. I look for stocks that are a great fit for this portfolio, review the portfolio on a regular basis and make adjustments as necessary. Of course, I reserve the right to make any exceptions to buy or sell a stock. The results will be published here on Growing Money every month. I seek companies that have a healthy balance sheet and a competitive business advantage in the market, thereby protecting my principal investment. The dividend growth will help build a stream of growing income for the long term. If the dividends are sustainable and increasing over time, then naturally, the stock prices should follow and the total returns should be wonderful. This is a long term investing plan, which is a marathon and not a sprint, so do not expect any flashy words or colorful signs in these posts. It’s going to be a slow and steady climb to the top of the mountain. The strategy is to buy strong and healthy companies with dividends that are sustainable and increasing over time. All the dividends are automatically re-invested in the same companies. This portfolio will be reviewed on a regularly basis to ensure that the holdings are aligned with the goal of this portfolio.

Investment Objective
The DGI Portfolio seeks to provide, primarily, a growing stream of income over time and, secondarily, long-term capital appreciation and current income.

Investment strategy
The DGI Portfolio invests primarily in stocks that offer current dividends. The portfolio focuses on high-quality companies that have prospects for long-term total returns as a result of their ability to grow earnings and their willingness to increase dividends over time. These stocks typically—but not always— have a low dividend payout and shows a history of increasing dividends. The DGI Portfolio will be diversified across industry sectors.

Account Balance
Beginning Balance: $96,333.14
Ending Balance: $102,812.20
Net Gain/Loss: +$6,479.06 (+6.7%)

Portfolio Holdings:

Symbol Current Price Quantity Current Value Dividends (per share) Dividend Yield (%) Annual Dividends Prorated Monthly Dividends
VZ 54.08 207.173 $11,203.91 0.565 4.18% $468.21 $39.02
T 39.17 208.339 $8,160.63 0.48 4.9% $400.01 $33.33
JNJ 108.20 102.271 $11,065.72 0.75 2.77% $306.81 $25.57
O 62.51 204.506 $12,783.67 0.1985 3.82% $487.13 $40.59
OHI 35.30 723.83 $25,551.19 0.57 6.46% $1,650.33 $137.53
IBM 151.45 101.874 $15,428.81 1.3 3.43% $529.74 $44.15
MIC 67.44 308.409 $20,799.10 1.15 6.82% $1,418.68 $118.22
Cash $2,863.17
Total $102,812.20 $5,260.93 $438.41

Note: Options balance is not shown in this table.

Dividend Payouts This Month:
3/8/2016    MIC    $348.42
3/8/2016    JNJ    $76.16
3/10/2016    IBM    $131.21
3/15/2016    O    $40.46

Month Total: $$596.25

Lifetime Cumulative Dividends Received: $2,972.04
*This is the total dividends received since the inception of this portfolio in June 2015.

Portfolio Update

In March, we saw a strong rebound in the stock market. Unfortunately, during the down market I had sold long date covered calls and had capped all the gains. I did not expect such a strong rebound and now many covered call options are in the money.

MIC – Macquarie Infrastructure Corp (NYSE:MIC) has rebounded since the last big drop. I hope to see this stock above $70 by the end of May.

IBM – International Business Machines Corp. (NYSE:IBM) has rebounded strongly and has closed above $150 by the end of the month. I thought it would take several months to get back above $150 but IBM has been outperforming the market and has climbed back quickly. IBM continues to make aggressive acquisitions in their big plans to transition to a more service-oriented company. IBM should announce an increase in Q2 of this year based on their dividend payment pattern. I hope to see a 15-20% increase. IBM is a great long term stock.

O – Realty Income Corp (NYSE:O) is known as The Monthly Dividend company and it is arguably the safest and most wanted company in the stock market this year. The stock has defied gravity and kept soaring higher, making new all-time highs recently. I want to build a bigger position in this stock, so I do hope this stock drops soon so I can buy the dips.

OHI – Omega Healthcare Investors Inc (NYSE:OHI) has bounced back a little. OHI is a great long term hold for a dividend growth portfolio. They have consistently increase their dividends.

AT&T Inc. (NYSE:T) and Verizon Communications Inc. (NYSE:VZ) have been performing very well recently. I do think they may be approaching premium valuations and may have to take a breather soon.

Options Strategy

Many of my covered call options are in the money. With the stock moving high, the options are moving deeper in the money. I may have to buy back the options at a huge loss or wait until there’s a drop in the market again.

Short Term Goal – Year 2020
My short term goal is to build a $500 monthly dividend income on a prorated basis from this portfolio by the year 2020. I will make adjustments that are necessary to steer towards this direction. Currently, my monthly passive income for this portfolio is at $438.41, so I still have some way to go. These monthly updates will be constant reminders for me to stay focused and work hard on my goal. By making this portfolio opened to the public, I will hold myself accountable and show my thoughts and decisions to everyone. Good luck to me!

Happy investing!! Build passive income for life!


2 thoughts on “DGI Portfolio Report for March 2016

    1. Sean Post author

      Hi Investment Hunting,

      First off, thanks for stopping by here. How did you come across this page?

      The nearly $600 in dividends was only because many of the companies paid their dividends in the same month. I think there was another month where I had a higher record, it really depends on when they pay their dividends because many of my stocks pay quarterly dividends. Therefore, I like to look more from a quarterly view and prorate that to a monthly figure, where it is currently at $438.

      I took a glance at your site and found that our backgrounds and goals are very similar. I had sent you an invite on Hangout to discuss more about dividend investing with you.


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