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Well, after a prolonged holiday vacation and catching up with the inevitable landslide of emails and tasks that accumulated at my day job, I've finally been able to get around to writing an end of year article about how things turned out for my IRA's portfolio in 2012, and how I see things going with My Mad Method (MyMM).

To start off with, let's see what positions I had at the beginning of 2012:

Comb

MyMM

Rank

Rank

Company

Ticker

Yield

16

7

Apple

(AAPL)

0.00%

6.82%

15

12

Abbott Laboratories

(ABT)

3.41%

3.06%

21

5

Alamos Gold

(AGIGF.PK)

0.82%

2.78%

13

24

Central Fund of Canada

(CEF)

0.05%

3.21%

25

23

Contact Energy Ltd

(OTC:COENF)

5.61%

2.54%

12

2

Cirrus Logic, Inc.

(CRUS)

0.00%

2.51%

14

19

Crescent Point Energy Corp

(CSCTF.PK)

6.11%

2.84%

6

18

Duet Group

(OTCPK:DUETF)

9.52%

2.60%

23

11

Endeavour Silver Corp

(EXK)

0.00%

3.94%

24

22

Ford

(F)

1.86%

2.83%

9

9

Freehold Royalty

(OTCPK:FRHLF)

8.67%

2.92%

16

20

Kimberly Clark Corp

(KMB)

3.81%

2.92%

6

4

Keppel Corp

(OTCPK:KPELF)

4.18%

7.11%

18

13

McDonald's Corp

(MCD)

2.79%

2.98%

1

1

Annaly Capital Mgmt

(NLY)

15.04%

4.43%

3

3

National Presto Industries

(NPK)

8.81%

2.97%

19

21

PetroChina Co

(OTC:PCCYF)

4.81%

2.47%

20

16

Peyto Expl & Development Corp

(OTCPK:PEYUF)

2.94%

3.08%

5

10

RWE AG NPV

(OTC:RWNFF)

14.46%

4.33%

11

13

Statoil

(STO)

3.82%

4.69%

3

8

StoneMor Partners, L.P.

(STON)

9.98%

2.67%

8

6

AT&T

(T)

5.69%

3.15%

10

17

Telstra Corp

(OTCPK:TTRAF)

8.24%

2.93%

22

15

United Parcel Service

(UPS)

2.84%

2.90%

Avg>

5.14%

3.44%

Yup, lots and lots of international stocks in that lineup. At the beginning of last year I was still somewhat tethered to my former broker and a lot of the positions they had put me in when I moved my post-2008 pile of cash into an IRA with them in July of 2010. I had already taken the first steps towards investing independence in October of 2011 and made some purchases based on my own nascent goals, adding companies like Abbott Labs, Ford, Kimberly-Clark, McDonald's, Annaly Capital, StoneMor Partners, AT&T and UPS to my stable.

However, it was around the middle of last year that my investing goals finally came into focus and I started shifting my portfolio aggressively towards a Dividend Growth Investing (DGI) strategy. This was due in no small part to articles and comments by Seeking Alpha Contributors such as David Van Knapp and Robert Allen Schwartz, as well as frequent comments from folks like chowder. Thanks to them and many others, my eyes were opened to the benefits of building a portfolio of solid, stable dividend payers that were also steadily growing their dividends at rates that beat the average for inflation, with the goal of ending up with a revenue stream from dividends by the time I retire that can meet my income needs, or in other words, be my "paycheck" in retirement. Of course, one of the important tenets of DGI is to strive to not have to sell off any of your investment assets to meet your monthly bills during retirement, but to live comfortably on what your investments throw off in the form of dividends, distributions and the like.

I listed out everything that I'd sold off and the new stocks I'd purchased when I reported my Q3 2012 results back in October, so I won't rehash that information here. Since that time, the only position I have sold was Staples (SPLS), which I only held briefly. Also, the only new positions I've added since the beginning of October were international utility company National Grid (NGG) and promising upstart Business Development Corporation (BDC) Prospect Capital Corporation (PSEC). This brought the total number of positions in my IRA's portfolio to 28. Here's the list of what I was left with at the end of 2012, which is also what I currently have:

Comb

MyMM

Rank

Rank

Company

Ticker

Yield

% Alloc

19

22

Apple

AAPL

1.99%

2.44%

3

1

AFLAC, Inc.

(AFL)

2.64%

2.68%

9

7

American Capital Agency

(AGNC)

17.30%

4.37%

1

2

Alliance Resource Partners, L.P.

(ARLP)

7.48%

5.32%

5

9

BreitBurn Energy Partners, LP

(BBEP)

10.07%

4.90%

2

4

BHP Billiton plc

(BBL)

3.24%

5.80%

7

3

ConocoPhillips

(COP)

4.55%

4.51%

17

21

Crescent Point Energy Corp

CSCTF.PK

7.30%

3.98%

24

20

Exelon Corp

(EXC)

7.09%

2.71%

5

26

Freehold Royalties, Ltd.

FRHLF.PK

7.46%

4.33%

24

19

France Telecom

(FTE)

9.14%

2.02%

23

16

Hasbro, Inc.

(HAS)

4.01%

3.45%

9

12

Johnson & Johnson

(JNJ)

3.48%

4.17%

12

23

Kimberly Clark Corp

KMB

3.51%

3.09%

26

15

The Coca-Cola Company

(KO)

2.81%

3.32%

20

11

Linn Energy, LLC

(LINE)

8.23%

2.58%

8

17

Main Street Capital Corp

(MAIN)

5.90%

4.75%

15

8

MV Oil Trust

(MVO)

12.63%

3.59%

28

25

National Grid, plc

4.00%

2.63%

4

5

Annaly Capital Mgmt

NLY

14.25%

1.93%

21

24

Nokia Corporation

(NOK)

4.56%

1.45%

18

14

National Presto Industries

NPK

9.41%

3.29%

21

18

Prospect Capital Corporation

12.14%

2.84%

9

28

SeaDrill, Ltd.

(SDRL)

9.24%

4.55%

16

27

AT&T

T

5.34%

3.24%

12

10

Vanguard Natural Resources

(VNR)

9.35%

4.76%

26

13

Vodafone Group, plc

(VOD)

4.05%

2.65%

12

5

Walgreen Company

(WAG)

2.97%

3.73%

Avg>

6.93%

3.54%

YoY Increase>

1.79%

As you can tell from comparing what I started the year with and what I ended the year with, only seven of my original positions have survived the flurry of buying, selling and more buying that I went through in 2012. I don't expect to do nearly as much trading in 2013, but I do expect to continue to add to my existing positions by using the dividends I will be collecting throughout the year, as well as doing my best to make the maximum $6,000 contribution to my IRA that someone of my age is allowed by the IRS.

The following is a summary of the changes between the end of Q3, 2012 and the end of Q4, 2012, which also illustrates my overall results for 2012:

As you can see, like pretty much everyone else (I imagine), things took a turn southward during Q4 of last year. Most of the loss of ground in the value of my portfolio from Q3 to Q4 happened after the elections in November which, given the results of the voting, didn't surprise me.

Also, while I was holding my own versus the S&P 500 (SPY) up through the end of Q3, 2012, I ended up losing a bit of ground to that index by the end of the year. I imagine that this result may prompt some of those folks who don't cotton to the DGI approach to investing to say, "See, told ya so. You should've just plopped your money into an indexed fund and not put yourself to so much trouble."

However, taking a page out of chowder's book, I really don't care that the S&P 500 beat me by almost 4% in terms of the increase in the value of my portfolio for the year. To me, that's not what DGI is all about. What I'm much more pleased about is that the amount of annual dividends that my portfolio now generates doubled from what it was at the beginning of the year. That, to me, indicates that I had a very successful year managing my IRA's portfolio on my own, and that I will have more funds to work with during 2013 to continue to add to my existing positions and, hopefully, add some more DGI positions in my quest to end up with as many as 50 positions in my stable of companies.

(Another thing to note about the data above is that the total commissions that I spent with Interactive Brokers since I moved my IRA over there last April is still less than what it would have cost me for just two trades with my former broker. Something to consider when you're thinking about taking control of your financial destiny.)

As for My Mad Method, I feel that it has been working for me as a means of evaluating different stocks against each other and helping me to decide where to put accumulated and contributed funds each month. It's certainly not perfect, and some decisions I have and probably will make may seem counter-intuitive given the MyMM Ranks of some of the stocks I have purchased. But, personally, I need some sort of "system" by which I can guide my purchasing decisions, and I'm pleased with how MyMM has helped me in that regard.

Thank you for following along with me on this adventure in individual retail investing. I will continue to write articles detailing what I will be adding to my IRA in the future, although I don't expect that I'll be selling off (or even from) many of my existing positions during 2013 (but, you never know). Stay tuned for what I'll be buying next, and why…

(Please keep in mind that I am not an investment professional or advisor. I'm just a regular guy trying to manage my own IRA's portfolio so that I can eventually replace my regular paycheck with the income from dividends from my investments when I retire. The purpose of this article is not to promote any one stock, but to document my process and journey of selecting stocks for my portfolio and, hopefully, watching it grow.)

Source: My Mad Method: Year-End Results 2012

Additional disclosure: Disclaimer: I am not a professional investment advisor or financial analyst; I’m just a guy who likes to crunch numbers and can make an Excel spreadsheet do pretty much whatever I want it to do, and I’m doing my best to manage my own portfolio. This article is in no way an endorsement of any of the stocks discussed in it, and as always, you need to do your own research and due diligence before you decide to trade any securities or other products.