Retirement Strategy: Buy On Dips, Add To Core Holdings (Part 6)

by: Regarded Solutions

Ok, so call me a fanatic, I don't care! How could I take a week off from writing without having my last article of 2011 be an update of our Retirement Strategy Core Portfolio?

Our portfolio consists of ExxonMobil (XOM), Johnson and Johnson (JNJ), AT&T (T), General Electric (GE), Annaly Capital (NLY), Exelon (EXC), Procter and Gamble (PG), McDonald's (MCD), Philip Morris (PM), Intel (INTC), Realty Income (O), ConocoPhillips (COP), Pfizer (PFE) Chevron (CVX), E.I. du Pont (DD), Duke Energy (NYSE:DUK), PPL Corp. (PPL).

After all, the readers here put this portfolio together (a team effort based on comments and direct messages to me) on a day when I wrote an article (read here) about buying on the dips and adding to core holdings.

It was on November 23, 2011 and things looked bleak everywhere. Europe was in the headlines as well as a forecasted worse than expected outlook for the 4th quarter economic activity here in the States.

It seemed like the bulls were running for their lives and the bears were roaring.

I went out on a limb and put my own portfolio on the line that day, and we as a group added some stocks, deleted some stocks and came up with a core portfolio that we could track.

Now forgive me. I did say we would check back in at the end of January, but since we ended the market year on a down day, I felt it would be really cool to see where we stand with our core portfolio as we say so long to 2011.

How Are We Doing?

Stock Buy 11-23 12-31-PPS Cost Basis Cur.Value
XOM 75/SHR 85/SHR 7500 8500
JNJ 62/SHR 66/SHR 6200 6600
T 27/SHR 30/SHR 2700 3000
GE 15/SHR 18/SHR 1500 1800
NLY 16/SHR 16/SHR 1760 1760
EXC 41/SHR 44/SHR 16400 17600
PG 61/SHR 67/SHR 12200 13400
MCD 92/SHR 100/SHR 9200 10000
PM 71/SHR 79/SHR 9940 11060
INTC 23/SHR 24/SHR 2300 2400
O 32/SHR 35/SHR 3200 3500
COP 67/SHR 73/SHR 6700 7300
PFE 18/SHR 22/SHR 1800 2200
CVX 94/SHR 106/SHR 9400 10600
DD 44/SHR 46/SHR 4400 4600
DUK 20/SHR 22/SHR 2000 2200
PPL 28/SHR 29/SHR 2800 2900
Tot.Value 100000 109420

Portfolio Highlights

1) We have also sold covered calls (read here).

2) We have also collected dividends of approximately $2,500.

3) We have an increase in portfolio value of 9.42% in a tad over 1 month.

4) We have a cash reserve balance of roughly $5,800 ( Dividends and call premiums) to deploy when we decide.

5) Our average dividend yield has gone up from 4.15% to 4.22% because of the increased dividends in some of our holdings so far.

Actions To Take Now

1) Review our holdings and see if we should drop anything.

2) Are there any stocks we should add to our core using our cash reserves of $5,800?

3) Should we stand pat and review our core during and at the end of January 2012?

My Opinion

We have done quite well in a little over one month. A 9.42% return for a month is nothing to sneeze at. We outperformed the markets as a whole and stood our ground.

We bought when others were selling and we have a foundation for 2012 that looks pretty darn good to me.

Well done Team "Alpha"!

Happy New Year ... See you in about a week!


I am long XOM, JNJ, T, NLY, GE, EXC, INTC, O, PFE.