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Eddie Herring

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  • How Much 'Extra' Return Are You Getting If You Reinvest Dividends? [View article]

    Good article. Keep pounding the table on that compounding thing. It's going to catch on yet.

    Jan 26, 2015. 07:59 PM | 10 Likes Like |Link to Comment
  • My Roth Conversion Odyssey (Part 2) [View article]

    Excellent article describing your odyssey and one that has created an outstanding discussion on the different scenarios one can consider in making these transitions. You're the Ulysses of the Roth Conversions.

    Jan 25, 2015. 03:19 PM | 5 Likes Like |Link to Comment
  • The Dividend Growth Weighting Game [View article]

    See my response to David Van Knapp above. Maybe it will help explain the existentialism of my math.

    Jan 22, 2015. 09:17 PM | 1 Like Like |Link to Comment
  • The Dividend Growth Weighting Game [View article]

    Ha! It's not just new math, it's so far ahead in the R&D department it's called developmental stage math... or maybe even D.C. balanced budget national debt social security is fine math.

    Actually, what I do is simply let the Excel spreadsheet I use calculate the percentage of $ value of each position in relation to the total $ value of the portfolio. The prices automatically update when I open the spreadsheet using a Yahoo Finance add on for Excel. All i have to do is open it up and I immediately know the price, the total $ value of each position, the total portfolio value, and the % of each position in relation to the total portfolio value.

    These positions are across 3 different accounts but I list them as if they are all one portfolio. Where I say there are 33 positions, in the spread sheet there are 38 listed. But KO, for example, is listed twice, because it is held in the taxable account and in the IRA. So, I open up the spreadsheet tonight and it tells me that KO closed at $43.78 today and it's 4.02% in one account and 4.88% in another account, which I round off to say it's 9% of the total portfolio value. WBA is 5.23%, KMB is 1.97%, WFC is 2.58% and so forth.

    The spreadsheet simply averages all those individual positions from Row 1 to Row 38. Cash is included in the total portfolio value but is not used in calculating the average position size.

    To my French Philosopher friends comment below about the 15% and 5% average, what I mean is that I don't want any one position to exceed 15% of the total portfolio value. And if I were to decrease the number of smaller positions that left me with more higher valued positions but fewer positions overall, it's possible the average position size could get over 5% and I want to keep it below that 5% threshold. Which means I have to manage the total number of positions, as well as the impact of individual positions to the portfolio, and the spreadsheet helps me do that.

    The 33 position number I currently have is not a constant. Since some of the positions are for speculation, I periodically add to or sell positions. It's not likely that I'll reduce the number of positions down to where a 5% average is likely, but it is mathematically possible.

    Is this clear as mud?

    Jan 22, 2015. 09:12 PM | 1 Like Like |Link to Comment
  • The Dividend Growth Weighting Game [View article]

    Well, I admit I typed a smart-aleck comment about MAIN but deleted it, afraid someone who doesn't share my warped sense of humor might misinterpret it.

    Anyway, good article and good discussion. I tend to overweight my holdings based on my thoughts of quality of the company but it's not a stenciled in stone type rule. KO is my largest position, 9% at the current time. Out of 33 positions the average position size is 2.35% but they run from 1% to 9%.

    I have a general rule of thumb of what I prefer each position to be but it's more of a general guide than a rule. My investing plan says I can go up to 15% in any one position but the average can't exceed 5%.

    Jan 21, 2015. 09:03 PM | 3 Likes Like |Link to Comment
  • The Continuing Search For Quality [View article]

    Thanks. As I mentioned in the article one of the factors (there are others not listed) that I use in determining quality is a strong financial/credit rating.

    I believe I did own up to the mistake by describing it in the article. But I haven't decided to move on with the company just yet. I don't tend to be reactionary to my buys, including the speculative ones, allowing them time to play out. Over time that has served me well.

    I have my own selling guidelines but I do appreciate the kind thoughts and the link. Thanks for reading and commenting.

    Jan 17, 2015. 02:50 PM | 3 Likes Like |Link to Comment
  • My 2014 Fourth Quarter Review: The Good, The Bad And The Ugly [View article]

    I think of your quarterly updates as watching someone on a journey using their map (your business plan), making sure they're still on the correct path, traveling in the right direction, and making the progress they expected. Sometimes one may have to detour while on the journey but the detour is only to take them back to the original path.

    While your travel plan has you holding stocks/businesses for the long term income, you have amply demonstrated that you may occasionally have to remove (detour) one or more of those companies from the portfolio (travel path). Or even fix a flat on the vehicle.

    Your quarterly review tells me you're still on your way and meeting the goals you've set for your progress. I say job well done. Keep up the good work, my friend.

    Jan 16, 2015. 07:28 PM | 2 Likes Like |Link to Comment
  • Dividend Growth 50: Costco Horns In On The Fun [View article]

    WOW. You may have made a new discovery. We not only have BogleHeads, we also have CostcoHeads. Ha, just kidding. :)

    The zeal with which the Costco shoppers talk about it is obvious that it is a good operation and that zeal might just be the economic moat an investor looks for.

    Good article and best of luck with the investment.

    Jan 8, 2015. 06:14 PM | 1 Like Like |Link to Comment
  • Grandma's Money: The Frozen Portfolio [View article]

    Very good update on your continuing story for grandma's portfolio. I have always found myself somewhat hesitant to dispense specific financial advice to my parents if it wasn't asked for. But there comes a point sometimes when circumstances dictate that. I respect your efforts in that regard.

    My own mother is 81 years old now and my Dad passed away in 2006 so I help her as much as I can, or I should say, as much as she will accept. She has always been, and still is, quite independent, but will now ask my advice much more quickly than in the past.

    Thank you for setting an excellent example and best wishes as you continue the journey.

    Jan 6, 2015. 07:51 PM | Likes Like |Link to Comment
  • My Dividend Growth Portfolio: 2014 Review And 2015 Preview [View article]

    When I started reading this the old Marvin Gaye and Tammi Terrell song "Ain't nothing like the real thing" started running through my head. There's nothing like using a real portfolio in real time with real money to demonstrate a concept.

    Good job of demonstrating a solid concept of what not only occurs with dividend growth but the returns that also come with that growth. It's not a hypothesis, and it's not speculative, it's the real thing.

    Jan 6, 2015. 06:25 PM | 1 Like Like |Link to Comment
  • My Top 3 Holdings For 2015 [View article]

    Excellent article re: your 2015 portfolio and top 3 holdings. You have assembled a lot of quality companies in your portfolio, which as you know, I really like. Keep up the good work and best wishes for a great year.

    Jan 4, 2015. 04:29 PM | 1 Like Like |Link to Comment
  • 2014 Year-End Portfolio Review [View article]

    I thoroughly enjoyed reading this excellent review of your portfolio this year.

    I am glad to hear you point out what all too many often forget when it comes investing but will always remain true, and that is that "life happens." Being able to continue to contribute to your future livelihood, even in the midst of life happening, is a victory to be celebrated in itself. Or should I say happy danced to?

    I personally like to think of those years when I exceed my goals as setting something aside for a rainy day, because over a 20 or 30 year period, there will be those times when you won't quite reach your goal for a given year. Those up years allow me to remain on track for the long term goal when the down years try to drag it down.

    I am confident you will remain on track toward your goals because you are looking more than at just this year, you are already thinking 20 years down the road. And thinking and preparing for the future is a huge step in arriving there on target. Best of luck in 2015 and beyond!

    Jan 4, 2015. 04:09 PM | 4 Likes Like |Link to Comment
  • The Continuing Search For Quality [View article]

    Thanks. I appreciate it.

    Jan 3, 2015. 06:00 PM | Likes Like |Link to Comment
  • The Continuing Search For Quality [View article]
    Obi Wan

    I like your face card analogy. If the ace is growing dividends, king is quality, queen is valuation, then I suppose the jack could be margin of safety, perhaps even profitability or diversification. Obviously there are all kinds of ways to think about quality.

    We all have made those purchases that we later decided was a mistake. But just like when we make mistakes in life, we put them behind us, learn from the experience, try not to repeat them, and keep on going.

    As you say, it's the overall portfolio that will determine one's success, not any one position, assuming we have position size correctly accounted for in our portfolios. Thanks for reading and commenting. And Happy New Year to you as well.

    Jan 3, 2015. 12:25 PM | 1 Like Like |Link to Comment
  • The Continuing Search For Quality [View article]

    Definitely, looking to add to quality or add quality, either way IMO will keep the portfolio strong.

    Thanks for reading and commenting.

    Jan 3, 2015. 12:09 PM | Likes Like |Link to Comment