J.D. Welch's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.com/user/1637861/comments http://seekingalpha.com/article/1413841/comments?source=feed#comment-18679981 18679981
I'm long BBL, too, but was a bit concerned that I might have been chasing a falling price, and potentially falling into a "value trap", as NeedMoreCoffee mentions below. Also, it's just under a 3% allocation, and with parity being 3.33%, didn't seem like as good a choice for buying more shares than PM or UVE, despite having the #1 weighted MyMM ranking this time around...]]> Fri, 10 May 2013 12:46:34 -0400
I'm long BBL, too, but was a bit concerned that I might have been chasing a falling price, and potentially falling into a "value trap", as NeedMoreCoffee mentions below. Also, it's just under a 3% allocation, and with parity being 3.33%, didn't seem like as good a choice for buying more shares than PM or UVE, despite having the #1 weighted MyMM ranking this time around...]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18679711 18679711 Fri, 10 May 2013 12:41:56 -0400 http://seekingalpha.com/article/1413841/comments?source=feed#comment-18679551 18679551
Actually, if you read my articles for this year, you'll see that I've added 9 new positions to my portfolio, netting a gain of 2 new positions overall to go from the 28 I had at the end of 2012 to 30 now. Adding new positions, however, requires a goodly amount of cash, which really I only get when I can make a contribution to my IRA, of which I am limited. So far I've contributed 50% of what I'm allowed to contribute for this year for someone my age, and looking at my cash flow (and the potential for a dip in the market over the summer months), I'm not in a hurry to add a 3rd quarterly infusion of cash at this time. The other way I can generate enough cash to pick up a new, additional position is to "trim" some profits from other positions that have performed very well and are well above the parity number AND have shown a profit. I did that recently, and am not ready to do that again with the summer looming and the potential for a seasonal dip in the market overall...

Thanks for the in-depth analysis of NPK. Personally, I'm well aware of NPK's product and risks, but I really like this company. Perhaps that's not a "rational" approach, but I love the management and their commitment to paying shareholders as much as they can, and the CEO's relatively low salary and relatively very high amount of skin in the game in terms of the number of shares she holds. As for their military contracts, their product(s) here are ammunition, the majority of which get consumed during routine training exercises, not actual combat, and even though there have been (and probably will be) defense cuts, I don't see the Pentagon pulling back on being prepared by cutting practice shooting too drastically. :-) Also, last I heard they were having some success in branching out in terms of the number of customers for their absorbant products. All-in-all, I like NPK, and have held it since 12/14/2011, and don't mind the risk that its 3.08% allocation of my portfolio's total value represents. Finally, while it took a big hit in price in early 2012 when it announced annual results and a lower-than-expected dividend, the price of NPK has been improving steadily since then, especially in recent months, such that I have made more from 2 annual dividend payments than I've lost from a drop in the share price from my cost basis, so it's "in the green" as far as I'm concerned, and doing better now than it was last year at this time...

Thanks for your comments, though... :-)]]> Fri, 10 May 2013 12:39:15 -0400
Actually, if you read my articles for this year, you'll see that I've added 9 new positions to my portfolio, netting a gain of 2 new positions overall to go from the 28 I had at the end of 2012 to 30 now. Adding new positions, however, requires a goodly amount of cash, which really I only get when I can make a contribution to my IRA, of which I am limited. So far I've contributed 50% of what I'm allowed to contribute for this year for someone my age, and looking at my cash flow (and the potential for a dip in the market over the summer months), I'm not in a hurry to add a 3rd quarterly infusion of cash at this time. The other way I can generate enough cash to pick up a new, additional position is to "trim" some profits from other positions that have performed very well and are well above the parity number AND have shown a profit. I did that recently, and am not ready to do that again with the summer looming and the potential for a seasonal dip in the market overall...

Thanks for the in-depth analysis of NPK. Personally, I'm well aware of NPK's product and risks, but I really like this company. Perhaps that's not a "rational" approach, but I love the management and their commitment to paying shareholders as much as they can, and the CEO's relatively low salary and relatively very high amount of skin in the game in terms of the number of shares she holds. As for their military contracts, their product(s) here are ammunition, the majority of which get consumed during routine training exercises, not actual combat, and even though there have been (and probably will be) defense cuts, I don't see the Pentagon pulling back on being prepared by cutting practice shooting too drastically. :-) Also, last I heard they were having some success in branching out in terms of the number of customers for their absorbant products. All-in-all, I like NPK, and have held it since 12/14/2011, and don't mind the risk that its 3.08% allocation of my portfolio's total value represents. Finally, while it took a big hit in price in early 2012 when it announced annual results and a lower-than-expected dividend, the price of NPK has been improving steadily since then, especially in recent months, such that I have made more from 2 annual dividend payments than I've lost from a drop in the share price from my cost basis, so it's "in the green" as far as I'm concerned, and doing better now than it was last year at this time...

Thanks for your comments, though... :-)]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18676291 18676291
I actually am weighting based on income potential, by weighting Yield and 5 Year Dividend CAGR at 30% vs. the 5.88% of the other metrics.

The problem with looking just for "Buy" signals, is that with the run up the market has been experiencing for the last I-don't-know how-many-weeks, almost everything is Reading "Too High" at least. Some things slip into "Stable" as their 52 week highs catch up to their current prices just as a function of time passing, but it's not as easy as just buying the things that have a "Buy" Reading. PM and UVE are so far behind the rest in terms of % allocation that I feel compelled to concentrate on them, and some of the other stocks that are further behind in terms of % allocation, such as VOD (2.70%) and LMT (2.79%). The problem with VOD is that it only pays dividends twice a year, and we're approaching what I think is its ex-div date, and I won't have quite enough cash built up from collected dividends to make a good purchase prior to that, and then after that there's really less of a point of jumping into it when it's Reading "Screaming!", too. If it gets back to a position of being "Stable" or better, then it's going to move up on my radar of what to buy next, but other than that, once I miss this ex-div date (which is the bigger dividend payout of the two per year they do), then there's less of an incentive to get aggressive buying it. LMT, on the other hand, I just want more of, and will get around to it eventually.

At this point I'm waiting for the "Sell In May" effect to kick in, which it may have started to with today and yesterday's results in the market (at least so far today). Need to be patient and see if we get the same downturn for summer that history says we should, then I can look for bargains in the positions that are under allocated.

Thanks for the comment! :-)]]> Fri, 10 May 2013 11:39:33 -0400
I actually am weighting based on income potential, by weighting Yield and 5 Year Dividend CAGR at 30% vs. the 5.88% of the other metrics.

The problem with looking just for "Buy" signals, is that with the run up the market has been experiencing for the last I-don't-know how-many-weeks, almost everything is Reading "Too High" at least. Some things slip into "Stable" as their 52 week highs catch up to their current prices just as a function of time passing, but it's not as easy as just buying the things that have a "Buy" Reading. PM and UVE are so far behind the rest in terms of % allocation that I feel compelled to concentrate on them, and some of the other stocks that are further behind in terms of % allocation, such as VOD (2.70%) and LMT (2.79%). The problem with VOD is that it only pays dividends twice a year, and we're approaching what I think is its ex-div date, and I won't have quite enough cash built up from collected dividends to make a good purchase prior to that, and then after that there's really less of a point of jumping into it when it's Reading "Screaming!", too. If it gets back to a position of being "Stable" or better, then it's going to move up on my radar of what to buy next, but other than that, once I miss this ex-div date (which is the bigger dividend payout of the two per year they do), then there's less of an incentive to get aggressive buying it. LMT, on the other hand, I just want more of, and will get around to it eventually.

At this point I'm waiting for the "Sell In May" effect to kick in, which it may have started to with today and yesterday's results in the market (at least so far today). Need to be patient and see if we get the same downturn for summer that history says we should, then I can look for bargains in the positions that are under allocated.

Thanks for the comment! :-)]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18675511 18675511
I wasn't aware of GSBC. I hold NYCB (a small bank) in my IRA, and RBCAA (another small bank, in Kentucky) in my wife's IRA, so I'm not in a hurry to add any more small (or large) banks to my portfolios at the moment. I've tried to steer clear of the Financials, for the most part, although I do wish I'd gotten into WFC when I first started looking at it over a year and a half ago. I will add GSBC to my watch list and see how it fares there. Thanks!]]> Fri, 10 May 2013 11:28:14 -0400
I wasn't aware of GSBC. I hold NYCB (a small bank) in my IRA, and RBCAA (another small bank, in Kentucky) in my wife's IRA, so I'm not in a hurry to add any more small (or large) banks to my portfolios at the moment. I've tried to steer clear of the Financials, for the most part, although I do wish I'd gotten into WFC when I first started looking at it over a year and a half ago. I will add GSBC to my watch list and see how it fares there. Thanks!]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18675241 18675241 Fri, 10 May 2013 11:23:13 -0400 http://seekingalpha.com/article/1413841/comments?source=feed#comment-18674971 18674971
1) For the time being. I would like to eventually get to 50 positions, like my buddy chowder, so that the target parity for each position is 2.00%. But for the time being, I'm happy where I am at 30 positions, and I won't be adding any big chunks of cash to my IRA (aside from accumulated dividends) until Q3 at the earliest, so I really won't have enough to comfortably start a new position until then (and if then). I've got plenty of time (relatively) to get up to 50 positions, so for now I'm just concentrating on getting those that are well below parity up closer to parity.

1a) I have a watchlist, but it's gotten shorter as I've added new positions to my and my wife's IRAs; I currently have 15 stocks on my watchlist. I need to do some research and add a handful (or 2) of new stocks to my watchlist, but I'm just too busy with my day job and family life to take the time to do the necessary research to dig around and find some good, new candidates.

2) I have, but haven't come up with an approach that I'm comfortable with. One reason is, the stocks that pay much higher yields, such as mREITs and BDCs, tend to not appreciate in price as regularly as the CCCs such as JNJ, KMB, KO, T, etc., so even though a stock may be "underbalanced" in terms of the % of the total of what it contributes to my income stream, it's more likely to appreciate, which, in turn, lowers its yield. On a purely cash basis of how much does each position contribute to the income stream, I'm a bit out of balance. But I'm not sure how to balance that out and not get horribly skewed in terms of % allocation of the total value of the portfolio. It's something I noodle on every now and then, but for now, I'm just watching the % allocation, and keeping an eye on % of total income to try to make sure things don't get too out of whack.

Hope that helps, and thanks for your questions! (Sorry it's taken me so long to get back to you; I was teaching a class this week, and replying to comments here on SA took a back burner...)

:-)]]> Fri, 10 May 2013 11:18:30 -0400
1) For the time being. I would like to eventually get to 50 positions, like my buddy chowder, so that the target parity for each position is 2.00%. But for the time being, I'm happy where I am at 30 positions, and I won't be adding any big chunks of cash to my IRA (aside from accumulated dividends) until Q3 at the earliest, so I really won't have enough to comfortably start a new position until then (and if then). I've got plenty of time (relatively) to get up to 50 positions, so for now I'm just concentrating on getting those that are well below parity up closer to parity.

1a) I have a watchlist, but it's gotten shorter as I've added new positions to my and my wife's IRAs; I currently have 15 stocks on my watchlist. I need to do some research and add a handful (or 2) of new stocks to my watchlist, but I'm just too busy with my day job and family life to take the time to do the necessary research to dig around and find some good, new candidates.

2) I have, but haven't come up with an approach that I'm comfortable with. One reason is, the stocks that pay much higher yields, such as mREITs and BDCs, tend to not appreciate in price as regularly as the CCCs such as JNJ, KMB, KO, T, etc., so even though a stock may be "underbalanced" in terms of the % of the total of what it contributes to my income stream, it's more likely to appreciate, which, in turn, lowers its yield. On a purely cash basis of how much does each position contribute to the income stream, I'm a bit out of balance. But I'm not sure how to balance that out and not get horribly skewed in terms of % allocation of the total value of the portfolio. It's something I noodle on every now and then, but for now, I'm just watching the % allocation, and keeping an eye on % of total income to try to make sure things don't get too out of whack.

Hope that helps, and thanks for your questions! (Sorry it's taken me so long to get back to you; I was teaching a class this week, and replying to comments here on SA took a back burner...)

:-)]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18632651 18632651
Yeah, I added UVE to my watchlist as a result of some comments folks made here on SA, then pushed past my concerns over it being such a small player and went ahead and bought some based on other comments from more folks here on SA. I'm glad I did... :-)]]> Thu, 09 May 2013 13:11:54 -0400
Yeah, I added UVE to my watchlist as a result of some comments folks made here on SA, then pushed past my concerns over it being such a small player and went ahead and bought some based on other comments from more folks here on SA. I'm glad I did... :-)]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18631871 18631871
Sorry for the delay in replying. I'm co-teaching a class this week, and have limited time in which to respond.

To be brief, it's not that the MyMM Ranking shows the "best" option, as much as it shows the best Ranked stocks based on the weighted metrics of all the stocks in a given set. I often choose the "best Ranked", but not always; it's not an absolute "you must buy this next" result, but a tool to guide me in the right direction and narrow my choices down from a larger field to a smaller set, and then from that set I have to make a final decision, which can have a lot of different other variables affect it based on what's going on at that point in time and what my current short-term goals are with respect to reaching my long term goals...]]> Thu, 09 May 2013 12:57:00 -0400
Sorry for the delay in replying. I'm co-teaching a class this week, and have limited time in which to respond.

To be brief, it's not that the MyMM Ranking shows the "best" option, as much as it shows the best Ranked stocks based on the weighted metrics of all the stocks in a given set. I often choose the "best Ranked", but not always; it's not an absolute "you must buy this next" result, but a tool to guide me in the right direction and narrow my choices down from a larger field to a smaller set, and then from that set I have to make a final decision, which can have a lot of different other variables affect it based on what's going on at that point in time and what my current short-term goals are with respect to reaching my long term goals...]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18592831 18592831 Wed, 08 May 2013 15:44:45 -0400 http://seekingalpha.com/article/1413841/comments?source=feed#comment-18592731 18592731
:-)]]> Wed, 08 May 2013 15:41:57 -0400
:-)]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18592291 18592291
In the end, I went with adding a bunch of more shares to the position that had the lowest percentage allocation over adding just a handful of shares to a position that was relatively closer to "parity".

Hope that helps... :-)]]> Wed, 08 May 2013 15:36:44 -0400
In the end, I went with adding a bunch of more shares to the position that had the lowest percentage allocation over adding just a handful of shares to a position that was relatively closer to "parity".

Hope that helps... :-)]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18591691 18591691
:-)]]> Wed, 08 May 2013 15:26:47 -0400
:-)]]> http://seekingalpha.com/article/1413841/comments?source=feed#comment-18591421 18591421
And to me, at least, having all of my positions within a certain +/- range of parity is an important goal. I don't want to be in a position where one stock, which could have a much higher percentage allocation than many others, suddenly takes a dive, or cuts or even eliminates its dividend. The purpose of keeping everything close to the parity target of equal percentage allocation is to protect my capital from unforseeable circumstances.

So far the process is working rather well for me. The YTD return on my portfolio is currently 2.87% higher than that of SPY (which is the counter to the argument some present of "just put your money in an indexed fund; what you're doing is too much work!"), and I should realize 18.60% more in dividends (income) by the end of this year than I did last year, which is really the ultimate goal for this portfolio: To be generating enough income by the time I retire to replace my paycheck.

Thanks for your comments, though, and for taking the time to read my article!]]> Wed, 08 May 2013 15:20:05 -0400
And to me, at least, having all of my positions within a certain +/- range of parity is an important goal. I don't want to be in a position where one stock, which could have a much higher percentage allocation than many others, suddenly takes a dive, or cuts or even eliminates its dividend. The purpose of keeping everything close to the parity target of equal percentage allocation is to protect my capital from unforseeable circumstances.

So far the process is working rather well for me. The YTD return on my portfolio is currently 2.87% higher than that of SPY (which is the counter to the argument some present of "just put your money in an indexed fund; what you're doing is too much work!"), and I should realize 18.60% more in dividends (income) by the end of this year than I did last year, which is really the ultimate goal for this portfolio: To be generating enough income by the time I retire to replace my paycheck.

Thanks for your comments, though, and for taking the time to read my article!]]> http://seekingalpha.com/article/1355381/comments?source=feed#comment-18552221 18552221 Tue, 07 May 2013 16:30:00 -0400 http://seekingalpha.com/article/1338681/comments?source=feed#comment-17950541 17950541 Mon, 22 Apr 2013 17:21:44 -0400 http://seekingalpha.com/article/1355381/comments?source=feed#comment-17944991 17944991
I'm not aware of any "taxation disputes" that US companies are subject to, but that doesn't mean they don't exist... Can you describe what it is you're looking for?]]> Mon, 22 Apr 2013 15:33:38 -0400
I'm not aware of any "taxation disputes" that US companies are subject to, but that doesn't mean they don't exist... Can you describe what it is you're looking for?]]> http://seekingalpha.com/article/1355381/comments?source=feed#comment-17944841 17944841
I don't necessarily sell immediately after the ex-div date, no. I try not to sell if I'm very close to the ex-div date, but I'm not playing that game of buying (hopefully low), waiting for the ex-div date, locking in the dividend, then selling and going to look for something else I can do that with. I try to look at the upcoming ex-div date and not sell if I'm super close to it (which I hope I didn't do in the case of these stocks! Ha!), but really it was such a low number of shares, I wouldn't be too upset with myself if I'd sold one of them a week or two out from their ex-div dates. Don't think I did, but I'll double-check...]]> Mon, 22 Apr 2013 15:31:49 -0400
I don't necessarily sell immediately after the ex-div date, no. I try not to sell if I'm very close to the ex-div date, but I'm not playing that game of buying (hopefully low), waiting for the ex-div date, locking in the dividend, then selling and going to look for something else I can do that with. I try to look at the upcoming ex-div date and not sell if I'm super close to it (which I hope I didn't do in the case of these stocks! Ha!), but really it was such a low number of shares, I wouldn't be too upset with myself if I'd sold one of them a week or two out from their ex-div dates. Don't think I did, but I'll double-check...]]> http://seekingalpha.com/article/1355381/comments?source=feed#comment-17944661 17944661
It's not an arbitrary number. I explain it in previous articles, and chowder probably has a good InstaBlog where he explains it better. The goal is to minimize the risk of any one position dragging the value of the whole portfolio down if something untowards happens to that company. Hence, 50 positions, with the goal being a good degree of diversity mixed with some "doubling up" on certain industries or sectors (like owning both KO and PEP) to get the Top 2 dogs in that sector, and with an even distribution between them of the overall value of the portfolio, hence the 2% goal for each position. At the moment I now have 30 positions, so "parity" is 3.33%. Something that has grown significantly over that percent allocation AND has shown a profit is subject to getting pruned back, and those profits redistributed across other positions that are below the current parity level.

Hope that helps. I really recommend you read chowder's InstaBlogs here on SA; he's got a kind of tutorial on his view of Dividend Growth Investing [DGI] laid out over several entries, and explains the logic behind the approach that he uses, which I am attempting to emulate (to a certain degree)...]]> Mon, 22 Apr 2013 15:29:06 -0400
It's not an arbitrary number. I explain it in previous articles, and chowder probably has a good InstaBlog where he explains it better. The goal is to minimize the risk of any one position dragging the value of the whole portfolio down if something untowards happens to that company. Hence, 50 positions, with the goal being a good degree of diversity mixed with some "doubling up" on certain industries or sectors (like owning both KO and PEP) to get the Top 2 dogs in that sector, and with an even distribution between them of the overall value of the portfolio, hence the 2% goal for each position. At the moment I now have 30 positions, so "parity" is 3.33%. Something that has grown significantly over that percent allocation AND has shown a profit is subject to getting pruned back, and those profits redistributed across other positions that are below the current parity level.

Hope that helps. I really recommend you read chowder's InstaBlogs here on SA; he's got a kind of tutorial on his view of Dividend Growth Investing [DGI] laid out over several entries, and explains the logic behind the approach that he uses, which I am attempting to emulate (to a certain degree)...]]> http://seekingalpha.com/article/1355381/comments?source=feed#comment-17937961 17937961
Yeah, BBL is definitely near the top of the list for what to add to next. However, I've got a few other positions that are so far below parity that I'm kinda anxious to get them built up (and they have great dividends, too, as does BBL). But you never know; it might be BBL that gets some love next time around... :-)]]> Mon, 22 Apr 2013 13:03:21 -0400
Yeah, BBL is definitely near the top of the list for what to add to next. However, I've got a few other positions that are so far below parity that I'm kinda anxious to get them built up (and they have great dividends, too, as does BBL). But you never know; it might be BBL that gets some love next time around... :-)]]> http://seekingalpha.com/article/1355381/comments?source=feed#comment-17937901 17937901
Yeah, we'll need to see if "Sell in May" happens this year. If so, I've really got nothing else to trim profits from, but I will have dividends accumulating with which to purchase something that (hopefully) drops as a result... :-)]]> Mon, 22 Apr 2013 13:01:55 -0400
Yeah, we'll need to see if "Sell in May" happens this year. If so, I've really got nothing else to trim profits from, but I will have dividends accumulating with which to purchase something that (hopefully) drops as a result... :-)]]> http://seekingalpha.com/article/1355381/comments?source=feed#comment-17937821 17937821 Mon, 22 Apr 2013 13:00:33 -0400 http://seekingalpha.com/article/1355381/comments?source=feed#comment-17937791 17937791 Mon, 22 Apr 2013 13:00:13 -0400 http://seekingalpha.com/article/523991/comments?source=feed#comment-17936461 17936461
That's one of the great things about the MyMM spreadsheet: You can add (and remove) whatever metrics you want to to meet your particular tastes for how you want to evaluate stocks!]]> Mon, 22 Apr 2013 12:37:49 -0400
That's one of the great things about the MyMM spreadsheet: You can add (and remove) whatever metrics you want to to meet your particular tastes for how you want to evaluate stocks!]]> http://seekingalpha.com/article/1355381/comments?source=feed#comment-17861911 17861911 Sat, 20 Apr 2013 03:04:31 -0400 http://seekingalpha.com/article/1355381/comments?source=feed#comment-17861901 17861901 Sat, 20 Apr 2013 03:04:07 -0400 http://seekingalpha.com/article/1335681/comments?source=feed#comment-17709281 17709281 Tue, 16 Apr 2013 18:21:23 -0400 http://seekingalpha.com/article/1335681/comments?source=feed#comment-17677111 17677111
Not afraid of UVE, just being cautious, and have (or had) other priorities. I haven't plugged in my numbers from today's close, but it's likely that I won't be taking those profits like I thought I might. Unfortunately I've been too busy with work & family to act as quickly as I'd like to have, but, c'est la vie! I've still got my eye on UVE, I just was planning on bringing HRS &/or PM up closer to parity. Now I've got to see where everything stands, and decide what to do over the next few days. Thanks for the info on UVE, appreciate it!]]> Tue, 16 Apr 2013 00:45:08 -0400
Not afraid of UVE, just being cautious, and have (or had) other priorities. I haven't plugged in my numbers from today's close, but it's likely that I won't be taking those profits like I thought I might. Unfortunately I've been too busy with work & family to act as quickly as I'd like to have, but, c'est la vie! I've still got my eye on UVE, I just was planning on bringing HRS &/or PM up closer to parity. Now I've got to see where everything stands, and decide what to do over the next few days. Thanks for the info on UVE, appreciate it!]]> http://seekingalpha.com/article/1338681/comments?source=feed#comment-17651201 17651201
Thanks, JP. My thoughts exactly!...]]> Mon, 15 Apr 2013 13:20:00 -0400
Thanks, JP. My thoughts exactly!...]]> http://seekingalpha.com/article/1338681/comments?source=feed#comment-17651091 17651091
Thanks for the comments, folks!]]> Mon, 15 Apr 2013 13:18:27 -0400
Thanks for the comments, folks!]]>