This post is a monthly update to track the performance of my IRA portfolio. The goal of this portfolio is to build wealth and generate income for retirement. The strategy is to buy companies with strong growth prospects and a high dividend yield. All the dividends are automatically re-invested in the stocks. Dividends help grow income by buying more shares of the company and having more shares of the company help generate more income.
Account Balance at start of month: $20,317.22
Account Balance at end of month: $23,555.45
Net Gain/Loss for month: $3,238.23 (+15.9%)
IRA Portfolio Holdings:
ARCP – 747.61 shares
LNCO – 847.90 shares
SDRL – 401.92 shares
Dividend Payouts This Month:
LNCO $87.57 (Reinvested)
Oil prices rebounded in April due to lower rig counts and a slowdown in the fracking sector. This could be a temporary bounce because the Saudi’s are still pumping out oil at record highs which keeps the oil supply at a high level. Also, when oil prices rise, companies are more attempted to drill which would lead to higher supply and thus drive down the oil prices. It’s a cycle that would just keep going in the foreseeable future, so oil prices will hover around this area.
SDRL rebounded nicely from 9.35 to 13.09, an increase of 40%. SDRL was one of the earliest oil stocks to cut dividends which cause the huge drop from around $40 to the low teens in the second half of 2014. They had to cut costs to keep the company afloat during the oil price collapse. Even though SDRL has rebounded somewhat in April, it’s still far away from their $40 in June of last year. SDRL is still at risk because oil prices have not fully recovered yet.
LNCO is the only company in my portfolio that still pays a dividend. Hopefully management will maintain the dividend payments and continue to grow the company. My dividend payments are automatically reinvested back in the stock, so as long as the stock does not collapse, my dividends are helping me lower my break-even price.
ARCP’s stock price has been stagnant as I predicted last month. Hopefully this is a consolidation until they announce a dividend payment back to the shareholders. Once ARCP reinstate the dividends, the stock should move higher.