Spreadsheets might not be entirely necessary, but, as far as I'm concerned, they have proven useful. Call me anal, because I have created spreadsheets for just about every facet of trading that I find relevant. My main spreadsheet, the one I visit almost daily, records the monthly dividends I received per share and their combined total. Although inaccurate because, as I was developing it, I initially deleted a number of stocks I had sold, then later decided that it would be better if I kept a complete record; consequently, it's an inaccurate mess, but one that still contains valuable information, I refer to on occasion. In the next section down, I record the sales I made during that specific year, along with information concerning each sale. The final section, which I faithfully update each Friday, accurately reflects my profit and loss from 2009 when I began keeping records to the present. I actually know to the dollar my actual profit from the day I re-entered the market.
The first slice pictured is taken from the month-by-month record of dividends received for each share owned:
It's simple, straight-forward needs no explaining. At the bottom of each month I record the total collected. On the sad occasion a dividend is suspended, I mark the box that accordingly with a susp. rather than the missed payment. An easy way of knowing how many payments I am owed because I only invest in cumulative preferreds.
Pictured above a slices I selected to demonstrate how and when I arbitraged the Ashford Hospitality Trust (AHT)-A and E preferreds. Notice the 2011 dates, which were the dates of each AHT-A sale. Also notice when I purchased them, in 2009, at the absolute bottom of the market. The column to the right of those purchase dates record what my total cost was. The next column records what I received for each sale, followed by the date of sale, which I already mentioned, the profit per sale, and the number of shares comprising each trade.
Pictured above is the slice I selected to display the particulars of the AHT-E purchases. The first column to the right of the symbols displays the yearly dividend totals I expect to receive. The next column the total cost (notice that my initial buys were above par. I was not concerned because it was a new issue, not callable until this year, 2016, A good yield at the time.) As its price fell, I continued to buy, and at the time I noticed that the price of the A's now exceeded the price of the E's, which offered the better yield. I jumped on it and sold the A's at a greater price than the E's I was buying.
Pictured above are the Quantum details of the AHT-A and E preferreds, showing the dividend distributions of each, the final evidence of a successful arbitrage. Memories of this warms the cockles of my heart.
Pictured above is a slice of a spreadsheet I created that details each year's dividends I expect to receive, which I add to with each purchase, and subtract from with each sale, call, or unfortunate suspension of dividends. I said I was anal.
I also created spreadsheets for trading tactics I had developed along the way to add to my yearly income. I no longer do this because it is time consuming and mildly stressful, although rewarding, yet not worth my bother, considering my age and economic circumstance. Although pictured above, I have detailed how to play this in a previous SA article.
And finally to lay to bed the musings of occasional skeptical comments, pictured above are slices from my spreadsheet that recorded the dates of purchase along with the dates and effective yields of each purchase of the preferreds of FelCor Lodging Trust (NYSE:FCH) and the former Strategic Hotels & Resorts (NYSE:BEE). The column just to the right of the symbols lists the amount of the expected dividends, next is the cost of each purchase, next the effective yield, the number of shares, cost per share, date of purchase, payment per year per share. This is just a sliver of the purchases I made around that time when the market was slowly recovering from the 2008 catastrophe.
In conclusion, spreadsheets can be an effective way of keeping accurate records of just about any information you want to recall that might or might not help with potential and future trading decisions. They're also a great way to organize trading tactics as displayed with the D-play spreadsheet slice. They can keep a running accounting of your yearly, or lifetime investment goals, prompting investment decisions as to the purchase of more or fewer positions to populate your growing or shrinking portfolio.
Disclosure: I am/we are long AHT-D, AHT-E.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.