Late August the stock market dropped significantly. The usual reaction ensued. People panicked, sold stock at now lowered prices, and the market dropped for a few more days before stabilizing. After a few small bounced up and down, the past week we've seen a bigger climb back. Two investment strategies should be high-lighted.
First, investment discipline. If you panic and get out of the market during a drop, you'll probably miss out on the bounce back. In fact, if you buy during a down time, you follow the old principle of 'buy low, sell high'. Many emotional investors to the opposite. If you have a set schedule then a drop in the market presents an opportunity to buy up some great stocks at bargain prices. Dividend growth investors love it when quality stocks go on sale. I buy stocks every month, with income from the prior month and fresh capital. Over time this results in dollar cost averaging, and you isolate your portfolio from timing the market. It takes some discipline though, to buy into a falling market.
Monday, October 5, 2015
Our Active Passive screener scores hundreds of stocks automatically based on their dividend history and other characteristics. This month, we found two stocks that had a perfect score. This means we should take some time to learn more about these companies and see if they are a fit for our portfolio and investment goals. The companies are EMR and CFR. Details below.
Friday, October 2, 2015
In my Active Passive Money portfolio, I was able to add a new position in CAT. CAT was on my wish list for several months. CAT's stock price, like the rest of the market has been hit. And the business is in a downturn. But I trust that CAT's management can work this out like they have in the past. That's why I look for companies that have consistently paid and grown dividends even in wider market downturns.
Some other stats for September:
- I received $413.27 in dividends this month. Which is exactly what I expected a month ago. It's one thing I love about dividend investing. This is my best September ever.
- The trailing 12 months paid $4,169.39 in dividends.
- Year-to-date income is $3,316.17.
- Forward dividends are $4,960.10, which beats my goal of $4,850 for this year.
I have invested all my cash in my brokerage account. I will put in $500 fresh cash in October, and I expect $167.38 dividend income. I'm debating whether to grow my JNJ or CAT positions that are very small right now, or if I should look at EMR or some other great bargains.