Self-directed private investor. Formerly a executive in a public company with a background in finance. My focus is dividend growth investing and the purpose is to create and maintain a growing cash flow to pay my living expenses.
Who I Am: I'm a retired individual investor. I retired at the end of 2013 after a 35 year career as a professor and research scientist at a major research university. So -- a career as a researcher and an educator, which is what I hope to continue here. Virtually every good teacher I've ever known says some version of "I learn more from teaching than my students do." There's a lot of truth in that, enough that there's an underlying selfish motivation for my writing here as I continue to learn about investing.
My professional life involved multiple international projects and collaborations, so I traveled extensively over those 35 years. I plan to continue doing so in my retirement. One consequence is that I'm liable to disappear from the site for extended periods. How can you miss me if I don't go away?
My investing priorities are building and refining portfolios designed to provide income and capital growth: Income for my retirement needs, and capital growth for my estate. My investing interests are tax-advantaged income from a range of sources, portfolio strategies, information- and bio-technology, and momentum-based strategic allocation.
Why I Write for Seeking Alpha: I learned long ago that "writing is nature's way of letting you know how sloppy your thinking is." The line comes from a Guindon comic strip of many years ago, and could not be more true in my case. When I did research professionally, I learned that writing it up forces me to think about details I might otherwise overlook. It's how I spent my working career, so it comes more or less naturally to me. I consider it an essential part of doing any research. So, the writing I do here is as much for myself as for the reader. As I started to contribute articles here, they grew out of research for my personal investment portfolios. They're based on things I've uncovered that are of interest to me and may be of interest to others of like mind. My primary purposes in writing them are to help clarify my thinking and to get feedback from others who may have very different opinions. It's those thoughtful comments that make Seeking Alpha such an important resource.
I try to actively engage myself in the comment streams in my articles, contributing what I can and learning from others. As a research scientist I spent a career spanning four decades devoted to free exchange of information vetted by rigorous peer review. It's a concept I firmly believe in. I hope to bring that approach to my interactions and contributions on Seeking Alpha and welcome critical commentary on anything I may contribute here. I especially encourage and appreciate thoughtful comments from those who disagree with me (although I will ignore obvious trolls and encourage others to do so as well). So, go ahead, start a conversation in the comment threads. It's one of the best things about Seeking Alpha.
My Investment Philosophies and Strategies: I maintain two portfolios. My income portfolio is a taxable account. I try to keep it separate from the growth portfolio which is housed in a series of IRAs, traditional and Roth. My income focus is on tax-advantaged income. In 2016 I face minimum required withdrawals from my tax-deferred accounts, so tax efficiency is an important consideration. The IRAs I see as my estate and are focused on generational wealth building. That means the growth portfolios have a long-term horizon, well beyond what an investor of my age might be expected to maintain.
Who Is Left Banker? Ah yes, the name. When I first joined Seeking Alpha I had no intention of being anything but an occasional reader. I saw it as another research site. So, I just ported a name I've used on other sites. I spent some of the best times of my life living on the left bank of the Seine and am always thrilled to be back in La Belle Paris. Add that I also like it because I find several subtle word plays there; I'll leave it to you to decipher that comment.
Finally, I've chosen to remain anonymous, which I feel obligated to justify. First, I have no professional role in finance and nothing to sell, so there is no advantage to be gained by "making a name for myself' here. Second, I value my privacy and have kept my internet presence as low-key as my professional life allowed. I certainly want to avoid any possibility of some internet connection trying to track me down. Odds against that happening are, of course, outrageously long, but why take them on at all?
Disclosures: I have no ties to the financial or security industries in any form. My interests are strictly personal. The banker part of the nym has absolutely no relationship to the profession of the same name. Readers should be aware that I am an investing novice, some might say dilettante. I do not give advice; what I publish is much more in line with a research notebook. Anyone who finds anything of interest will necessarily want to do his or her complete research and due diligence. It would be foolish to rely on my conclusions without having done so.
My investment strategy is a hybrid of dividend-growth and capital appreciation. I’m in the process of building a reliable and growing income stream that will eventually replace our current earned income. If my dividend-growth investments are meeting quarterly and yearly goals, I consider long-term (and occasionally speculative) capital-appreciation opportunities.
My stock portfolio currently includes: COP and CVX in Energy; APD in Basic Materials; EMR, ITW, LMT, MMM, NSC, RTN, UNP, and UTX in Industrials; DIS, HAS, JWN, LOW, MCD, SBUX, and TGT in Consumer Discretionary; CVS, GIS, KO, KHC, PEP, PG, and WBA in Consumer Staples; ABT, AMGN, CELG, ESRX, GILD, JNJ, MDT, and SYK in Health Care; MA, TROW, and V in Financials; AAPL, CSCO, GLW, IBM, MSFT, QCOM, and SWKS in Technology; T and VZ in Telecom; AVA, D, LNT, SO, WEC, and WTR in Utilities; and CCP, DLR, O, OHI, and VTR in Equity REITs.
I don't benchmark my dividend-growth holdings but do compare their performance against the quarterly and annual goals stated above. I do compare the performance of my capital-appreciation stocks against the performance of the S&P 500. In general, I'm an infrequent seller.
Specialize in the investment in and trading of "deep-value" high-yield securities, including debt, preferred shares, common shares, put/call options, and ETF's, for my own and family accounts only. Have over seventeen years experience personally directing our personal and family accounts on a mostly full-time basis.
Was previously an international-business executive, general manager and entrepreneur in the medical-technology industry. Also provided consulting, related to general management, new-venture formation and acquisition of venture capital.
Education: Brown University, School of Engineering (Sc. B. '71); University of Virginia, Darden School of Business Administration (MBA '73).
Present Home: Sarasota, FL
Previous Homes: New York City, Mountain View, CA
Hometown: Baltimore, MD
Gary A. Gordon, MS, CFP® is the president of Pacific Park Financial, Inc., a Registered Investment Adviser with the SEC. He has more than 25 years of experience as a personal coach in “money matters,” including risk assessment, small business development and portfolio management.
Gary is often asked to consult as an educator. He has taught financial concepts in Mexico, Singapore, Hong Kong, Taiwan and the United States.
As a Certified Financial Planner™ (CFP®), Gary has distinguished himself as a reputable and trusted investor advocate. He writes commentary for ETF Expert, Seeking Alpha and The Street. Gary’s participation on local and national radio has spanned more than a decade, and he currently hosts the ETF Expert Show.
Gary is a “good sport” when his wife, Denise, beats him at Scrabble. Most of all, Gary takes special pride in a not-so-little energizer… his 19-year old daughter, Wei Elizabeth Gordon.
Reuben has extensive experience in the capital markets, especially in emerging markets, fixed income, derivatives and futures, commodities, and investment banking (including private equity). He has taught on the University level in the US and has lectured undergrads in Hong Kong and tutored privately to undergrads and grad students both in NY and in Hong Kong. On a day to day basis he provides consulting and advisement to privately held micro-cap and middle market companies and top tier management consulting firms (as an Engagement Manager) not only in Asia, but worldwide as well. His independent resources and connections and extensive top tier financial service firm's experience allows him to bridge the gap between Western and Eastern business practices and cultures.
His specialties include sales and business development, developing and creating business plans, capital markets, trading and sales of fixed income, derivatives and commodities including energy products, conducting due diligence, financial analysis and modeling. He has been successful at capital raising, teaching, advising and mentoring, marketing, mergers and acquisitions and negotiations along with creative problem solving abilities, structured products and risk management. His industry focus has been telecommunications, technology and software, (including CRM), education and the beverage sector. He trades on a daily basis on many diverse global markets.
In college in the early 1980's, my great aunt, who had no children, sat me down and told me to hand her the New York Times sitting on the coffee table. Then she pulled out a pencil-written piece of paper covered in letters and numbers, in fractions those days, mind you, and taught me about her stock portfolio. I learned what those funny letter combinations meant, like T, JNJ, GM, MCD and AUD (now ADP) and once I got the swing of it, those fractions weren't so hard either. Every Sunday, she looked up her stocks in the New York Times, added a column to her sheet of paper and, after long hand division, wrote down the value of each of her 30 or so blue chip dividend payers, including preferreds, built over a period of decades, starting in the 1920's, just before the 1929 crash. My great uncle died when she was in her 30's, yet because of that dividend paying portfolio, she never worked and died in her 90's with a closet full of furs and a box full of old passports with stamps from all over the world. I determined an independent income stream was for me. In the late 1990's my career in real estate took off but rather than do the stereotypical realtor thing of buying flashy new cars every year, I invested my commission checks in rental units and stock. I still own every rental property I ever bought, buying them cash flow positive at 20% down and riding whatever the market threw at me. They're mostly in the LA area, so it's been a wild ride. What mattered to me was positive cash flow, and rising rental income, not Mr. Market's current price opinion. With stocks, I've taken some risks and had a few blow ups, (anybody remember PSINet or Washington Mutual?) but the bulk of my investments have been and continue to be blue chip dividend payers, with a strong preference for those which raise their dividends yearly. At age 47, I retired with a comfortable and growing independent income stream from my rentals and my stock portfolio and took off for a beachside life in Mexico, greatly reducing my cost of living, especially in housing, food and medical care. I maintain 3 portfolios of my own, my main taxable account which provides current income (though I have so far reinvested all dividends and think I can do it for at least another 2 years because of cash on hand), my IRA with dividend income growing about 12% a year and another 9 years before I turn 59, and a small Roth IRA, where I do my more speculative investing, which amounts to about 1% of my total portfolio. My goal is to goose my returns with my speculative Roth IRA, while keeping the solid blue chip dividend aristocrats in my regular IRA and taxable account as the core of my holdings. I also help manage several family members' portfolios, including for my nieces and nephew, trying now to be the uncle example that my great aunt was for me. I use the S&P 500 as my benchmark and over the last 5 years that I have actively tracked my returns, I have beat the index each year, except for a tie in 2013. I beat the S&P in 2014 by almost 5 percentage points. I am a long term, hope-to-never-sell investor, not a trader, and follow a fundamental, Buffett-like approach with a dose of macroeconomics. For instance, I'm overweight Pharma, Medical equipment and Healthcare REITs because of the 'graying of America.' I own very small positions in two bond funds (about 1% of my portfolio) and stock in about 35 individual companies. I do not invest in stock mutual funds and have no plans to do so. It doesn't make much sense to me to pay for someone else to manage my money when I am beating the vast majority of professional money managers and have a passion for finance and investing. I keep my bonds to a minimum because I know that risk and volatility are not the same thing. Over time, stocks nicely outperform bonds and in 20 years I am confident that my stocks will have grown much more than my bonds. So, from this perspective, bonds are riskier than stocks. I very much appreciate the Seeking Alpha forum and am glad there are so many folks that have the patience to comb through annual reports and SEC filings, because it saves me from that minutia. I am very impatient with the rude, sarcastic and sometimes downright mean comments that some add to the threads, preferring to focus on the educational, mutually supportive nature of the majority of contributors.
Janus Capital Group Inc. (JCG) is a global investment firm dedicated to delivering better outcomes for clients through a broad range of actively managed investment solutions, including fixed income, equity, alternative and multi-asset class strategies. It does so through a number of distinct investment platforms, including investment teams within Janus Capital Management LLC (Janus), as well as INTECH Investment Management LLC (INTECH) and Perkins Investment Management LLC (Perkins), in addition to a suite of exchange-traded products under the VelocityShares brand as well as global macro fixed income products under the Kapstream brand. Each team brings distinct asset class expertise, perspective, style-specific experience and a disciplined approach to risk. Investment strategies are offered through open-end funds domiciled in both the U.S. and offshore, as well as through separately managed accounts, collective investment trusts and exchange-traded products.
Over 30 years of investing in individual stocks. Extensive business experience with small to mid-size companies, including as CEO. Many hundreds of blog posts on financial and economic matters since 2008. Focus on value with catalysts for upside price action. Background as a physician and pharmaceutical inventor and entrepreneur, however focus now is global and involves almost all economic categories.
I am a Civil Engineer, who is married with two young kids. In 2013 I took a more active role in managing my IRA for retirement and decided to publicly share my experiences in building the portfolio as an example for the dividend growth investing strategy.
My interest in investing mostly began in 2005 when I started up an investment club with a few friends from college and has accelerated as I've been reading and learning along the way. Since then, investing and the stock market has become a passion and favorite hobby and I've enjoyed writing about stocks and sharing ideas I have here on Seeking Alpha.
My investing goals are to build a nest egg for retirement and fund college education accounts for my kids. I invest mainly in dividend paying stocks that have shown a history of consistent growth in earnings and dividend payouts.
PetroEngInvestor (David Harter)
Hedge Fund Co-Founder and Managing Director
"Do you know the only thing that gives me pleasure? It's to see my dividends coming in."
-John D. Rockefeller
My wife and I are now retired. We live off SS and the income from our portfolio. My investments are all income producers and include dividend growth stocks like T and MO, some higher yielding low growth issues like PNNT. and others in between. About 25% of my income comes from fixed income preferred issues. When I was younger I was more into growth, but my goal was to switch to income and live off that. So that is what I have achieved today. I also work as a tax preparer for the 4 months of tax season.
Editor for The Biotech Forum, the #2 subscribed to Marketplace investment service offered through SeekingAlpha. Top 5% ranked analyst (TipRanks) 2013 through first half of 2015. Daily contributor for Real Money Pro. Hedge fund manager from 2008 to 2011. Previously technology executive at Fortune 100 firm for a decade.
Please go to biotechforumsa.com for more on the Biotech Forum service available through SeekingAlpha. For Free Investment Reports on a variety of topics go to bretjenseninvests.com
INDEPENDENT Financial Advisor / Professional Investor- with over 30 years of navigating the Stock market's "fear and greed" cycles that challenge the average investor. Investment strategies that combine Theory, Practice and Experience to produce Portfolios focused on achieving positive returns over a period of time. Providing advice in helping to avoid the pitfalls and traps that wreak havoc on your portfolio with a focus on Income and Capital Preservation.
I manage the capital of only a handful of families and I see it as my number one job to protect their financial security. They don’t pay me to sell them investment products, beat an index, abandon true investing for mindless diversification or follow the Wall Street lemmings down the primrose path. I manage their money exactly as I manage my own so I don’t take any risk at all unless I strongly believe it is worth taking.
Blogging here on SA is part of my research. I write to find out what I think.
I invite you to join the family of satisfied clients send an e-mail :email@example.com
I am a medical professional, but I have been studying investing for many years so that I can control my own portfolio. DGI seems to be the best way for me to invest for my retirement while being able to sleep at night.
I have also been successfully trading cash secured puts for extra income. I share my experience on my websites, Tradingcsps.com and my blog Tradingputs.com.
Wall Street Breakfast, Seeking Alpha's flagship daily business news summary, is a one-page summary that gives you a rapid overview of the day's key financial news. It's designed for easy readability on the site or by email (including on mobile devices), and is published before 7:00 AM ET every market day.
Wall Street Breakfast readership of over 900,000 includes many from the investment-banking and fund-management industries.
Sign up here to receive the Wall Street Breakfast in your inbox every business day: http://seekingalpha.com/account/email_preferences
Raised in America, Germany and the UK, I studied inter alia under Nobel Laureate Friedrich von Hayek in Freiburg i. Br., Germany. The next 30 years were spent as a financial economist with leading banks of their day: Morgan Guaranty Trust, J Henry Schroder Wagg, N M Rothschild and S G Warburg. Moving to Hong Kong in 1989, I was the Chief Regional Economist for the latter two banks and a smattering of others.
Affiliated with IAM Legacy Ltd., I now provide especially non-financial professionals with experienced, commission-free financial structuring advice - saving them costs northwards of 90% in the process.
Enzio von Pfeil (http://www.enziosclock.com/) has been an investment economist all of his professional life. Having studied under Nobel Laureate Friedrich von Hayek in Freiburg, Germany, he got his PhD in economics and then joined some of the major banks in their day: Morgan Guaranty, Schroders and Warburgs. He was Chief Regional Economist for major stock brokerages in Hong Kong since 1990, where he is happily married. Author of books and thousands of research notes, he is a regular guest of Bloomberg-UK and Bloomberg-Germany, and is invited frequently to CNBC and other channels. His focus always has been on how to make money out of economics, and his application is real: he now lives off his own investments. He founded Enzio's Clock (http://www.enziosclock.com/) in November 2000 with the objective to help his subscribers profit from cycles through rigorous application of his proprietary Economic Clock.
Doug Meeks is a Registered Investment Advisor in Plano, Texas. He is the Principal Advisor for Pier LLC, an investment management company. The focus at Pier is to build and manage income-producing portfolios for our clients. We provide individual service to those who are inclined to see their money working for them. Growth and income do not have to be different parts of your portfolio.
It's been quite a journey the past four years as I've learned about stocks, technical analysis, swing trading, dividend growth investing, and now options.
For 17 years, I home educated our children and tutored, while my husband supported the family. Once I worked myself out of that job, I had to decide what I should be when I grow up. Without a useful degree, my income is minimal, but I really enjoy my part-time jobs. I have used my jobs as a learning tool more than an income tool and they have been very profitable. I focus the rest of my time making my husband's income the most useful it can be, and managing our home. I enjoy playing with bookkeeping, finance, investments, taxes, and strive to be the best steward of all the resources (time, energy, health, family, money, stuff) we have.
The only purpose of my investing was to be able to afford to retire at a normal, reasonable age and hopefully to live off the dividends from those investments without needing to spend down the principal. As health concerns are forcing us to consider earlier retirement, the portfolio income may be needed at anytime. This does not worry me, it just changes the trajectory of the portfolio. I am very thankful for the gentle start into investing and am excited by what might happen in the future.
I’m so glad this website was recommended to me and I genuinely appreciate the contributors and their comments here and the growth that has happened through participation on the forum.
In case you're wondering about 'inzkeeper', I formerly managed an inn and the email moniker has stuck with me over the years.
Eric Parnell, CFA, is the Founder and Director of Gerring Capital Partners. Gerring Capital is a registered investment advisory firm seeking attractive returns opportunities emphasizing value, quality and risk control. Eric also publishes The Universal premium service on Seeking Alpha targeting winning strategies in bear and bull markets across the asset class universe. Gerring Capital implements these strategies for its investors and then Eric discusses them on The Universal. Eric is also a Visiting Instructor at Ursinus College in the Department of Business and Economics. Prior to founding Gerring in 2005, Eric was the Director of Investment Communications at SEI Investments and an Economist at Moody’s Analytics.
Retired, late 50's
Hold CFP designation. Passed CFP exam Nov 2000
Author of "IRA: A Quck Reference Guide". Available on Amazon as an e-book.
Author of "Retirement Investing for INCOME ONLY: How to invest for relaible income in Retirement ONLY from Dividends"
I seek to liberate investors from the chains of borrowed opinions by teaching metric awareness that leads to the formation of your own opinions. I am a retail investor that gathers, processes and analyzes significantly more data than average. I share that data in my articles. I let the data do the talking. I am only taking dictation as the data tells its message.
No book or blog or service to sell. Just a 39 year veteran of the financial industry on both the buy-side and sell-side with bulge bracket and regional broker/dealers, institutional, retail, commercial and investment banks. Started on the Bond side from the first CMO and the first Interest Rate Swaps and Caps to the death of grace and the implosion of sanity...not a lot I haven't seen. I am NOT an analyst. I am an old MBA, S-24, S-53 and RIA. Now a Managing Director for a Boutique SW investment banking house specializing in serving community banks and some oil & gas and small corporate private placements. This is NOT a solicitation. Do not "Follow" me. It is a waste of time. I will not publish any original material but may occasionally comment on others' work. The opinions stated are 100% unfiltered, 100% strong, 100% my own, 100% free and priced at fair value.
Retired Pharmacist. Call me Rose. Nose= Knows enough to know I need to keep learning and keeping a great dividend paying nest egg growing upwards.
My 81 stock portfolio is listed here by sector, largest holding by value is listed first.
Consumer Defensive (14): KO, PM, GIS, MO, TGT, KMB, CVS, DEO, PG, PEP, MDLZ, CL, KHC, UL.
Consumer Cyclical (8): MCD, SBUX, GPC, NKE, HAS, MAT, VFC, HD
Healthcare (5): JNJ, ABBV, AMGN, CAH, BDX
Healthcare eREITs (6) : OHI, VTR, HCN, NHI, CCP, HCP.
Energy (4): XOM, CVX, OXY, VLO,
Tech (3): AAPL, ADP, CSCO
Industrial(8): BA, UNP, MMM, CMI, CAT, GWW, NSC, LMT.
Financial (8): NRZ, ARI,, LADR (mREITs) TROW, MA, V, WFC, MET
eReits (9): WPC, DLR, O, CLDT, STAG, STWD, LXP, UBA, SNR (small)
BDCs (5): ARCC, MAIN, PNNT, HTGC, NEWT (small)
Telecom (2): VZ and T
Utility (9): SO, D, XEL, MGEE, WEC, DNP, LNT, CNP, FE
DNP is a CEF which predominately holds Utilities.
Jeff is the President of NewArc Investments Inc., manager of both individual and institutional investments. Jeff is a registered investment advisor, and portfolio manager for NewArc's investment programs.
Jeff is a former college professor with a hands-on, real world attitude. His quantitative modeling helped inform state and local officials in Wisconsin for more than a decade. A Public Policy analyst, he taught advanced research methods at the University of Wisconsin, and analyzed many issues related to state tax policy.
Jeff began in the financial business as Research Director for trading firm at the Chicago Board Options Exchange. He investigated anomalies in the standard option pricing models, taught classes for beginning options traders, and developed new forecasting techniques. In 1991 he established a general research consultancy, working with professional traders at all of the Chicago financial exchanges. In 1998 he started NewArc Investments, Inc.
Jeff has a commitment to the specific needs of individual investors. It is not a one-size-fits all approach, but one that emphasizes the unique circumstances of each client.
Jeff also serves on the board of two small technology companies (currently Chairman at one). He is occasionally as an expert witness in legal cases involving financial markets and hedging.
Principal En-lightener - Purveyor of Darkness.
And Now - The Gift...
Stupid is as stupid does - Forrest Gump;
You can't fix stupid, no pill for it, it's fo'ever - Ron White ;
There are idiots, look around - Larry Summers ;
To avoid the pernicious global plague of stupidity, drink the Kool-Aid and become one of the innoculati. The Kool-Aid is available at [VIRUS REMOVED BY ECHELON UNDER ORDER OF PATRIOT ACT II ... transmission terminated]
Bill Gross is a Portfolio Manager responsible for managing the Janus Global Unconstrained Bond Fund, and all related portfolios, and leading efforts to build out Janus' global macro fixed income capabilities. He also serves as an integral member of the Janus Capital Group Global Allocation Committee focused on the expansion of Janus' global asset allocation business. He is based in Newport Beach, California. Mr. Gross co-founded PIMCO in 1971 and served as managing director and Chief Investment Officer until joining Janus in 2014. Throughout his career, Mr. Gross has received numerous awards including Morningstar Fixed Income Manager of the Decade for 2000-2009 and Fixed Income Manager of the Year for 1998, 2000 and 2007. He became the first portfolio manager inducted into the Fixed Income Analysts Society’s Hall of Fame in 1996 and received the Bond Market Association’s Distinguished Service Award in 2000. In 2011, Institutional Investor magazine awarded him the Money Management Lifetime Achievement Award. He is a renowned expert within the bond market and is at the forefront of thought leadership on the subject of fixed income investing. He is also author of the books, Everything You’ve Heard About Investing is Wrong and Bill Gross on Investing.
Mr. Gross holds an undergraduate degree from Duke University and an MBA from the Anderson School of Management at the University of California, Los Angeles. He has 44 years of financial industry experience.
PRIMARY OBJECTIVE: ... Income Replacement!
Escape velocity is the speed that an object needs to be traveling to break free of the planet's gravitational pull and leave it without further propulsion.
This portfolio is looking for the point where the income being generated can allow the holder of this portfolio to escape the gravitational pull of the market and economic forces of worrying about share prices.
The objective is to generate enough income from assets that the only selling of shares will become an option, not a necessity to survive. Therefore, with enough income being generated, it minimizes the fear of meaningful market corrections as dividends are based on the number of shares owned, not the share price.
Time management is essential to monitoring a 47 position portfolio. My 1st comment concludes with "Rich-unck:xx hrs"; I uncheck from the article to avoid repetitive comments, nonsense, and (most) arguments. I extend another XX hrs when I respond to a question or comment...I also respond to all PMs.
BACKGROUND My journey as a self-directed investor (SDI) began in 1973, and resulted in financial independence at age 52, which also allowed me to retire from corporate life the following year (Feb 1995).
I have no special knowledge not attainable by others who also dedicate themselves to the study of the economy, market, and stocks...I could cease all portfolio management today, and place it with a professional manager; however, I enjoy the psychic and financial rewards. Alternatively, I could become a passive investor via mutual funds and/or index ETFs (those works too! ). With few exceptions, As a rule, Rich only discusses his IRA here--it is only a portion of his and Joyce’s investment assets.
INVESTMENT PHILOSOPHY If you ‘lived for today’ over the past 5 or 6 decades, you better invest in lottery tickets. The most probable path to a financially secure retirement is the product of an investment program (either active or passive) started when relatively young; living on less than all your after-tax income (saving means delayed gratification); and either self-directed or via professional management, adopting a sensible strategy suitable to age and comfort zone. There is wisdom in flexibility, diversification, and not being life-long wed to any strategy. It is appropriate to take greater risk for greater rewards (sensible growth stocks) when younger, as those are our lowest earnings years combined with our highest expense years--in the years between early investment and retirement, investments in solid growth companies can double 8 times or more.
There is time to adjust allocations to a more conservative strategy when closer to retirement. Never assume you have an information edge over the professionals. Time-in-the-market is your principle advantage. When/if you become interested in dividend stocks, never forget both price return and dividends compound, and price more so.
Financial independence is achieved when one has sufficient confidence his/her lifestyle will not change significantly, regardless of the potential depth or breadth of decline suffered by their portfolio--including a prolonged series of bear markets such as 1929-37. True, the recent 18-month bear market ending mid-2009, was deep--but also too brief to consider its lack of widespread dividend cuts to be as proof a portfolio of dividend-payers won't suffer income losses in a more prolonged decline (i.e., no portfolio is "dividend bulletproof").
The balance of this profile is lengthy, and likely not helpful to passive investors who simply go along for the ride, their portfolios bobbing up and down like flotsam in the ocean; their course always subject to the whims of winds, waves, and trends...THIS IS YOUR ONLY WARNING!
PORTFOLIO GOALS Now in my 70s, it’s no longer appropriate to engage in the growth strategies applied in wealth accumulation. As a more conservative investor, 100% of his portfolio consists of dividend-payers. 95% of positions have investment grade credit ratings (the lone exception is a REIT).This combination, along with having companies in 10 of the 11 S&P GICS sectors (none in Materials at this time) provide a measure of diversification. This IRA portfolio holds no bonds, though bonds and other investments are held elsewhere.
Maximizing total return and wealth preservation are mutually exclusive. A key observation: Having the capacity for risk is not the same as having the tolerance for it!
Rich’s objective is now a ‘smoother-ride’ that levels out the market’s peaks and valleys (limit losses, trim notable excess valuation). That smoother ride in an all-equity portfolio cannot be achieved without active management and continuous monitoring of positions--therefore TIME is an essential input to his portfolio management. Active management does not’ means frequent changes, as it is not unusual for a quarter or more to pass between a trimming or sale (nonetheless, when a company fundamentals change, or a mistake is made, corrective action is taken.)
STRATEGY SINCE 2008 Rich targets both legs of TOTAL RETURN (distributions + price change). His Growth & Income strategy often focuses on VALUE investing tactics applied to dividend-payers. Value investors seek out unpopular, companies most investors are avoiding (i.e., fundamentals have declined but credit rating is strong, BoD has implemented a rational recovery plan, and the dividend not in danger). Value investors seek to be paid to wait for other investors to recognize the stock’s value and assign it a greater share price. In any event, value stock or growth stock, Rich always seeks a ‘margin of safety’--no shares are bought at prices >FV, and his margin of safety is derived from dividends paid, price appreciation, and rising FV over time.
In all cases, value or growth, Rich selects well-established dividend-paying companies having a high-probability of growing earnings (growth of earnings is ESSENTIAL to growth of price and dividends). He tends to be flexible, forward looking, reactive to changing fundamentals, and willing to admit a mistake so action follows.
SDI is not easy, success is not assured, and in recent decades, advice from academics, and investment coaches, almost universally recommend index funds. Those NOT having the prerequisite time and interest are unlikely to develop the requisite skills for stock investing--thus the probability strongly suggests most newbies would be better served by indexing (Ben Graham wrote favorably of indexing). However, when done successfully, self-directed stock investing can offer rich psychic and financial rewards.
CORE PORTFOLIO Presently, +/-30 equities. Core holdings dominate at about 65% of total portfolio positions. Favored are traditional, large- and mid-cap, low-beta, best/near-best in class, institutional-owned, moaty, dividend-paying, value and growth stocks, having investment-grade debt ratings, and representing the consumer staples, healthcare, utilities, and telecom sectors.
OPPORTUNISTIC PORTFOLIO The remaining 15+ positions consist of equally well-known dividend-payers found among widely-owned cyclicals, such as financial, industrials, consumer discretionary, technology, real estate, and energy sectors are sensitive to the economy. In an expanding economy, cyclicals typically grow their earnings (and dividends) faster than do the typically slower-growing core companies. But because the reverse is also true, in a contracting economy, these positions are intended to be heavily trimmed to preserve gains as the economy peaks and shows evidence of decline. Some are susceptible to quite significant price declines when Mr. Market assumes their will suffer reduced earnings, and sometimes dividend-freezes/cuts, in anticipation of those events.
Rich is sometimes fully-invested, but unlike some, observes no such rule. Building a large cash cushion at the front-end of a correction/bear market (-20%) provides the dry powder required to both cushion the market's decline, and also creates the cash required to purchase excellent companies at below FV prices (without having to sell a position he wants to keep!).
TRIMMING POSITIONS When positions in either portfolio become significantly overvalued, they are trimmed by 5-10%, and the proceeds applied to fairly valued companies before the (almost always) temporary gift of over-valuation reverts to the price mean. If the position continues to advance, and absent other information, the position will be trimmed again. Added benefits to selective trimming include (1) serves as a more sensible method of rebalancing (as opposed to automatic--professionals do not use such a meat cleaver); (2) reduces the position's remaining Capital at Risk (which may suggest room for additional shares within an otherwise full position), and (3) provides the necessary dry powder to buy other shares at FV or below.
OTHER INTERESTS As we age, the importance of family grows. Rich has long volunteered in his community; over the years has served with distinction as member/chair of a number of advisory committees. Assisting others on SA is also a source of satisfaction and fulfillment.
Finally, having been blessed by years of excellent investment performance, Joyce and Rich have long been avid world travelers, and have visited over 60 countries over a span of 30 years (his SA avatar reflects the Taj Mahal in his sun glasses). They reside in Michigan--for 9 months of beauty, bliss, and family, and thoroughly enjoy wintering in equally beautiful Naples FL--for 3 months of sunny warmth and relaxation.
Life is good--it's been an unbelievably awesome ride!
I am a retired investor with market experience going back to the 1960s. I was a software engineer for 42 years, and currently do some part-time consulting, which lets me contribute to a Roth IRA. I am not an accountant and not a financial professional.
My wife and I have established a set of guiding principles for our investment life:
• Change is the only constant in life. Everything in this plan is subject to change.
• Never touch your principal. Wealth is built and maintained by not spending it. Wealth is the primary buffer between ourselves and blind chance.
• Exploit folly, do not participate in it (thank you, Chuck Carnevale). Do not follow the crowd, which is more often than not wrong.
• A portfolio is like a bar of soap – the more you touch it, the smaller it becomes. Do not be a trader.
• Own assets, avoid liabilities. Assets generate income. Liabilities generate expenses.
Based on these principles, we have established two investing goals: 1) sufficient current income with a comfortable buffer, and 2) increasing future income to maintain our buffer.
Our primary investing goal is to generate sufficient current income to cover that part of our living expenses not covered by pensions, with a comfortable buffer. We are retired and depend on investment income to meet a significant minority of our living expenses.
As we age and get closer to the end, current income becomes ever more valuable, and future income becomes ever less valuable. This reality informs all of our investing decisions. However, we know that inflation will cause our income needs to rise, so we also plan for increased future income, which is our second investing goal.
To meet our current and future income needs, we rely on 2 Social Security pensions, 1 private pension, income generated by investments, and fully paid up long term care insurance.
It is common to allocate a retirement investment portfolio with some percentage in stocks and the balance in fixed income, such as 60/40. We look upon our pension income as the equivalent of fixed income, with the added benefit that Social Security is indexed to the CPI. In the past we owned no fixed income and had no plans to do so in the future. The future has arrived and we have discovered baby bonds and preferred stocks, and we like the higher current income we can get from these investments. We have therefore started to redirect some of our investment capital into these investments, and as a result our investment income is now greater than it would have been otherwise.
We categorize dividends and interest as income, and capital gains as return of capital, not income. Therefore, our goals are to be met from dividends and interest only.
Investment income currently meets our primary investing goal. We invest in a blend of mostly medium yield (3%-6%) stocks with medium dividend growth, a few high yield (>6%) instruments with no dividend growth, low yield (<3%) stocks and funds with high dividend growth. and fixed income securities with yields in the range of 5%-8% with no growth.
We expect our medium yield and low yield stocks and funds to provide the income growth needed for the future, our second investing goal.
We currently own common stocks, preferred stocks, and bonds. Our portfolio requires regular attention to avoid possible dividend cuts and deletions. As we age, our mental faculties are in decline, and we will become increasingly less able to perform portfolio monitoring intelligently. There will come a time when we will need to use some form of income oriented index ETFs to carry the income generating burden.
We want to behave like landlords and collect rents, but without the risks and demands of owning real estate directly. Dividends and interest are our rental income, and as once-removed landlords we expect to own real estate investment trusts (REITs).
We want our non REIT income to be generated by long-lived, steady companies that provide products and services that we all need regardless of the economy, and thus can be relied upon to provide steady, and steadily growing, income. This requirement points primarily at consumer staples stocks. We own some of the best consumer staples stocks, such as mighty MO, and plan to own one or more ETFs that concentrate on the consumer staples sector of the S&P 500. Our preferred shares are almost all in the REIT sector.
• Some of my investing history
During much of my working years I used technical analysis (TA) to invest in individual stocks (I was an early fan of Joseph Granville and I bought an Apple II in 1980 because Granville brought out OBV software for the Apple at that time), and I speculated with short selling and commodity trading. Later I invested in stock mutual funds and ETFs for total return, with inconsistent results, and no comprehensive plan. Being a software engineer in a lead position left little time or energy for serious investing skills development. In 2005 I had pretty much given up on getting market beating results, and felt that I was getting too old and too close to retirement to continue swinging for the fences, so I decided to buy a variable annuity that guaranteed a minimum return of 6% per year, compounded, with the upside limited only by the performance of the mutual funds offered for investment. I decided to let the insurance company bear the market risk for me. I also had a 401k plan at work to which I contributed the maximum and got the company match. A year or so before 2008 I used a retirement investing projection tool provided by Fidelity, which said the worst returns I could expect in retirement were positive but not spectacular, and the best were hard to believe. At that time I was invested in mutual funds and ETFs through my 401k and the variable annuity and had not directly owned stocks since shortly before the start of the great bull market in 1982 (Granville famously missed the whole thing). I thought, with a bit of skepticism but not much, that I was set. We all know what happened in 2008-09. That experience put me off Monte Carlo simulations and Modern Portfolio Theory for life.
When I retired I converted my 401k to a rollover IRA brokerage account and invested in ETFs. I thought I was being appropriately conservative but also ready to capture capital gains by investing in VIG and VCSH.
Then I found Seeking Alpha, and then - thank my lucky stars - David Van Knapp, and the DGI light went on. I had spent most of my adult life thinking I was smarter than most people by relying on TA, and then later letting the insurance company assume market risk. I remember learning about the 200 DMA when I was in my 20s, which is a long time ago, and thinking how revolutionary this idea was and how I should be able to use it to my advantage. Fortunately for me and my family, I also was pretty good at software engineering, so I had a reasonable retirement nest egg accumulated when the time came. With the concepts and methodology of dividend growth investing, I now have sleep well at night investments that just keep on churning out increasing income, something that could never be said about using TA.
I started with DGI too late in life to commit totally to low yield, high growth stocks. I hope to capture the double compounding of DRiP investing with that part of my portfolio that is low yield, high growth.
We have recently (Nov 2014) rolled over all of the variable annuities into brokerage accounts. We now believe that we can get sufficient income from our dividend investing strategy, and we want to retain ownership of the annuity capital.
• Tools and Teachers
Tools I use include the CCC list, F.A.S.T. Graphs, Morningstar Premium, BigCharts, the EDGAR web site, longrundata.com, and Excel. I get ideas from the many informative articles by (among others) the following (in no particular order): Chuck Carnevale, Brad Thomas, Ron Hiram, David Van Knapp, David Fish, Robert Allan Schwartz, Dividend Growth Investor, Dividends4Life, David Crosetti, Tim McAleenan Jr., Reel Ken, Bret Jensen, Alan Brochstein, Chowder, Dane Bowler, Bob Wells, BDC Buzz, Scott Kennedy, Bill Maurer, Darren McCammon, Richard Shaw, Bruce Miller. Favorite commentators who are not yet authors include Elliot Miller, Paul Leibowitz, mbkelly75, surfgeezer.
Useful shortcuts to dividend stock valuation are the Tweed Factor and the chowder rule. Like F.A.S.T. Graphs, 'a tool to think with', these are 'rules to think with'.
Tweed Factor: fair P/E = yield + 5 year dividend growth rate
chowder rule: current yield + 5 year DGR >= 12%; 8% for utilities, MLPs, REITs
The best investment advice outside of Seeking Alpha has been 'The Intelligent Investor', ‘Securities Analysis’, and 'The Single Best Investment'.
• Some historical portfolio stuff
My DGI portfolio was started on 2011/4/20 with CTL, which I have since sold. It was a beginner's mistake. Subsequent mistakes were MLPs, and to a lesser extent, mortgage REITs. I did not allow for any circumstance that could cause WTI to fall as far and as fast as it has, so I lost money on MLPs. The prolonged flattening of the yield curve, plus the persistent markdown from NAV for the mortgage REITs, has made these unappealing as long term investments. Now I keep my distance from anything that is dependent on commodity pricing, and I invest very little in the carry trade. A glaring mistake was selling JNJ when it languished for several years.
• Some ongoing portfolio stuff
The target dividend growth rate for our entire portfolio is 5%.
I use yield on cost to allocate our investments so that each position in aggregate generates approximately the same amount of income. I learned the basic method for doing this from a comment on a SA article. SA is a wonderful resource! I have published an SA Instablog that describes the method: http://seekingalpha.com/instablog/902946-be-here-now/4581516-portfolio-allocation-for-equal-income-from-each-position-using-excel
• Current portfolio:
equity REIT: CCP, DLR, EPR, HTA, LTC, O, OHI, STAG, VTR, WPC
consumer staples: GIS, MO, PEP, PM
financial: GBDC, GSBD, HTGC, MAIN, TCPC
baby bonds: HTGX, NEWTL, TCCA, TPVZ
preferred: AGNCB, DFT-C, GAB-G, GGZ-A, HT-D, PSA-C
consumer staples: RHS, XLP
equity REIT: ESS, SKT
Technology: ADP, MSFT
Industrial: APD, MMM, RTN
baby bond: ARU, MSCA, TCCB, VTRB
preferred: DLR-G, STAG-B, VER-F
Retired Project Manager - 38 years with a national utility. Married 38 years and have 3 wonderful kids. USAF Veteran. Investing primarily in solid dividend paying companies with focus to generate income, capital appreciation is of secondary concern but still important.
As an SA Contributor I write about dividend investing general principles and strategies. I'll also write about concepts that apply across the investment spectrum but my focus is generally directed to dividend paying companies.
I tend to be conservative in investing approach. I invest and trade so as to increase my "discretionary" income. I live off my retirement pension and want to increase my account to provide additional income in future years. I'm 62 but haven't made a determination as to when I'll start using the additional income, preferring to remain flexible.
As a side note the profile picture is not me, it's my great grand-dad who was born in 1833, fought in the Civil War, fathered 11 children (the last one born when he was 67), worked hard as a farmer to take care of them, and died in 1910. I use it as inspiration to remind myself not to get lazy. I am fortunate to have been raised by great parents who set a great example for work ethic and taught me that we can accomplish much if we're willing to apply ourselves. That's why I invest my own money rather than depending on someone else.
I am a retired professor, a retired investment adviser, and currently a private investor and full-time tennis pro. I bought my first stock in a custodial account in 1958. I am a student of history, particularly military and economic/market history. The intellectual passions of my retirement years are markets, mathematics, and quantum theory. I like to travel. I served in Vietnam.