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The Part-time Investor

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  • Value Can Still Be Found In This Market: 5 Examples [View article]

    The analysts told me this past year to stay away from "Defense" stocks, like Lockheed Martin, due to all the cuts that were going to happen to the defense budget. But LMT is up 55% since I bought it early in 2013. With all due respect, I could not care less what the analysts say.

    If DE and LLL continue to increase their dividends then I will continue to hold them. And since they both have payout ratios in the low 20s they have plenty of room to grow the dividend, even if their earnings decrease some in 2014. But if they do not give me a dividend increase then I will sell them. SImple as that.
    Jan 4 10:37 AM | 4 Likes Like |Link to Comment
  • Dividend Growth Investing: A Better Way To Carry Out The 4% Rule [View article]
    Thank you David. I think it shows, once again, how important dividend reinvestment is.
    Dec 3 03:34 PM | 4 Likes Like |Link to Comment
  • Marrying The 4% Rule With Dividend Growth Investing [View article]

    You certainly have said many times that you love the DGI strategy. But you also seem to say, or at least imply, that a strategy which involves selling assets to come up with the 4% is equivalent to DGI. That they both work just as well. But they are not equivalent and they do not work just as well. I hope to have an article published today to show this. I'll post the link here if SA accepts it.
    Dec 2 10:17 AM | 4 Likes Like |Link to Comment
  • Marrying The 4% Rule With Dividend Growth Investing [View article]
    The risk of any one stock cutting its dividend is certainly there. But if you have a well developed DGI portfolio, with 30-50 stocks, or more, then the chance of the dividends of your entire portfolio falling is extremely low.
    Dec 2 08:31 AM | 4 Likes Like |Link to Comment
  • Marrying The 4% Rule With Dividend Growth Investing [View article]

    I know perfectly well what alpha is all about. Thanks for the condescending attitude.

    I have no idea what your comment was addressing. When I said that the risk of falling prices makes all the difference, I was referring to the difference between using dividends for your 4% vs selling assets. If you are using your dividends then the price of your assets is immaterial to your plans. But if you have to sell your assets when prices are down than that affect you immensely. So between those two philosophies, yes, the risk of falling prices makes all the difference.
    Dec 1 08:53 PM | 4 Likes Like |Link to Comment
  • Your Portfolio Business Plan: You Really Need To Do This [View article]
    I agree with you Chowder. I scan the headlines of all the e-mails SA sends me about my companies, but unless something really unusual is announced, the only ones I really pay attention to are the dividend announcements.
    Oct 20 08:45 PM | 4 Likes Like |Link to Comment
  • A New Retirement Portfolio [View article]

    I understand what you are saying, and you make a good point. But I still feel that they did not earn their money. I have consulted professionals before (I'm not talking about investing right now) to do something for me, or fix something for me, and have been told "You really don't need me for this. Go to Home Depot, buy piece A, go online and get instructions, and do it yourself. Yes, I could do it for you, but it will cost you a lot of money."

    Fidelity charged my parents a lot of money for something they very easily could have done themselves. Had they said to my parents "Just put your money into 3-4 ETFs and you'll do just as well as if we manage your money using a conservative approach, and you will save a lot of money" and parents STILL chose to go with them, then I would shut up. But they never told my parents that. They just took the money, used my parents risk profile as an excuse to basically park their money in a whole bunch of cookie cutter ETFs, and never looked at it again. It probably took 5 minutes of work.

    They could have earned that money by being more active in educating my parents and teaching them how they could improve their returns while still keeping their risk down.
    Oct 15 10:08 AM | 4 Likes Like |Link to Comment
  • My K.I.S.S. Dividend Portfolio 3rd Quarter Update [View article]

    I'm not sure what you would consider to be "accurately describing", but I understand the business of each company I own, to the following degree...

    McDonalds sell hamburgers.
    Qualcomm makes cell phone chips
    JNJ sells health care products.
    Kinder Morgan controls oil and gas pipelines.

    Do I need to know more about each of these companies to successfully invest in them? IMHO no. What i need to know is that they are successful doing what they do, they make a profit, and the profit is enough to pay a dividend and increase that dividend year after year.

    Understand, that I am not saying that someone who really studies the details of how these companies run their businesses can or will not do better than me. I'm not saying it is a waste of time. What I'm saying is that I can take one hour a month to make my picks, just based on my simple criteria, and spend the rest of my time living my life. And I will achieve results that I will be very happy with, and that will be pretty close to the results achieved by people who do choose to do all that research.
    Oct 13 02:52 PM | 4 Likes Like |Link to Comment
  • My K.I.S.S. Dividend Portfolio 3rd Quarter Update [View article]
    Thanks Dodger,

    My philosophy on the number of stocks I hold is that the more I have the less any single dividend cut can hurt me. None of my stocks make up more than 2.70% of my portfolio, and most are under 2.0%. So none of them would significantly hurt my dividend income if the dividend was cut. And since I only watch for dividend cut announcements, and do a portfolio review only every three months, it is not very difficult to follow 50-60 stocks.
    Oct 12 12:09 PM | 4 Likes Like |Link to Comment
  • A New Retirement Portfolio [View article]

    I know that MO is a great stock. But as a physician, I just couldn't live with myself by investing money with them.

    Looking at the FAST Graph of T and INTC they don't have the steady rising earning trend that I look for.
    Oct 7 07:49 PM | 4 Likes Like |Link to Comment
  • Blue Chip Dividend Value Strategy Delivers Solid Returns For Retirement Income [View article]

    I think DGIers by nature, and maybe even by definition, are more patient then the "average" investor. DGI requires one to be a long term holder, to collect and reinvest dividends through that long time period, and to let compounding work for you. To assume that most DGIers would sell MCD, or any other DGI stock during rough times is fallacy. Sure, maybe some would, but most, by adopting the DGI philosophy, have decided to hold through the good times and the bad, as long as the dividend and the business model of the company are still in tact. So the argument you often use, that most investors would have sold during tough times, does not work for DGI, because DGIers are not "most investors".
    Aug 31 11:30 AM | 4 Likes Like |Link to Comment
  • How To Plan For Your Retirement Income [View article]

    A happy wife is a happy life. And sometimes keeping the wife happy can be expensive. :-)
    Aug 29 08:48 PM | 4 Likes Like |Link to Comment
  • Chowder Rule Breakdown - High Growth Vs. High Yield In Your Portfolio [View article]

    I wrote what I believe and if you disagree with it you have the right to "pick" on me. I have no problem with that.

    You make an excellent point about trusting the companies I invest in. But what I trust is what they have done in the past, as demonstrated by the actual concrete dividends they have paid. I expect the trend will continue in the future, but I must actually see it if I am to stay invested. I can look at 5-10 different websites and find 5-10 different reports of what a company's earnings were in the past few years. For example, looking up Coca-Cola I found the following earnings in 2012 from these different websites:

    Optionsxpres -- 1.98
    S&P -------------- 1.97
    Yahoo ----------- 1.91
    FAST Graphs -- 2.07

    Which one is accurate? I don't know. They probably all are in some way. But they will all agree on exactly what dividend KO paid.

    I know I may be naive or ignorant on this point, and I have no where near the experience that you have, but I do not invest in a company for earnings. I invest for the dividend. If the company's earnings begin to suffer, that will eventually be reflected in the dividend, and once that happens I can decide what to do with that investment. But as long as they continue to pay me a dividend I am satisfied with I will be happy.

    I do not look at future earnings estimates, nor do I look at future dividend estimates. They are just guesses, and are usually wrong. I want to make my decisions based on facts. And an actual dividend paid is a fact I can rely on.

    Finally, it's not that I don't trust the company or the management. I believe in general that they do the best for the company and the shareholders. Nor do I believe that the earnings number they put out is a lie. It is just that that number can mean so many things to so many people, and can be interpreted in so many ways. And can be reported in so many ways. And can be adjusted in so many ways. It is too much for me to try to figure out.
    Jul 14 12:36 PM | 4 Likes Like |Link to Comment
  • Dividend Growth Investing And DRIPs Work Under All Conditions [View article]

    I'm glad it works for you. My concern would be that the price of the stock drops considerably as the growth rate slows (ie. APPL). At what point do you decide that the stock is "not growing" anymore, and how far will the stock have fallen before you make that decision? And how long might the company manipulate the earnings to make it look like they are still growing, before the truth comes out and the stock crashes? Dividend are concrete. Earnings are.....ummmm......soft? Can't think of a better word. lol
    Jun 11 08:58 PM | 4 Likes Like |Link to Comment
  • Are Streaks And Current Yields The Best Metrics For Dividend Growth Investors? [View article]

    Great first article! And your point is well taken. I would only say that, for me, I like to keep things simple. I'm not looking to analyze the thousands of stocks that pay dividends. By starting with the CCC list it limits the number of stock I have to consider and therefore makes my decision making easier. Will I miss some wonderful stocks? Of course. I don't expect to grab every great company out there. I just want a portfolio that has many of them.

    As to your point about companies that may have held their dividend steady one year, thereby falling off the CCC list, but still have an excellent CAGR, I would argue that a board of directors that freezes a dividend one year, is more likely to freeze it again, or even cut it, in a future year. A company that raises its dividend year after year, through thick and thin, no matter what (even if just by a penny), shows a culture that will do everything it can to continue raising its dividend. Knowing that about my companies makes me feel more confident about my future dividend income and helps me sleep at night.

    Once gain, thank you for a thought provoking article.
    May 20 01:28 AM | 4 Likes Like |Link to Comment