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very_thirsty_for_income

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  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear Dividends#1:

    Congratulations on exactly predicting the MO dividend announced today. You previously stated in a comment following your recent MO article

    http://bit.ly/XDLbqq

    that you have revised your prediction to agree with the upper limit of the guidance range-- 80% X 2.59 /4 = 0.52 per share quarterly.

    I am so glad that MO is in my retirement portfolio which I described in my comment above . MO is a continual dividend paying machine that persistently grows its dividend annually.
    Aug 21 06:36 PM | Likes Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear Hardog:

    If the trees are Redwoods, they last for centuries. A well designed and monitored portfolio with good "roots" and rigorous cultivation will outlast and survive many others. The author has a great portfolio in the making.

    VTFI
    Aug 21 05:22 PM | 1 Like Like |Link to Comment
  • A Dividend Growth Portfolio For New Investors And Retirees Yielding 4.3%, Part 2 [View article]
    Dear Dividends#1:

    Great call on the increased MO dividend to $0.52 dividend per your comment after your MO article which in effect,served as an "addendum" your MO article.

    http://seekingalpha.co...

    Certainly MO is a dividend cranking machine which rightfully belongs in this portfolio going forward.

    Sincerely,

    VTFI
    Aug 21 01:28 PM | 1 Like Like |Link to Comment
  • Altria Is The Best Dividend Growth Stock For Income Investors, I Rate Altria A Buy [View article]
    Hi Dividends#1:

    An excellent prediction-- you called 0.52 right on the nose. You have a terrific flair for judging what MO is likely to do with their annual dividend based upon their prior dividend payment patterns and their current business growth.

    Sincerely,

    VTFI
    Aug 21 01:21 PM | Likes Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear du4 and nv_gary:

    The author is successful in his retirement portfolio which cannot be used to offset capital losses in his brokerage account. I am even finding that even though my ENTIRE portfolio ( non-retirement + retirement) is gaining -- hopefully some day to the same extent as my carryover capital losses, it is unlikely in my case that I can offset all capital losses due to the more rapid appreciation of reinvested and non-taxed dividend distributions in my IRA accounts.

    Sincerely,

    VTFI
    Aug 19 11:05 AM | 1 Like Like |Link to Comment
  • A Dividend Growth Portfolio For New Investors And Retirees Yielding 4.3%, Part 2 [View article]
    HI Again Dividends#1:

    I meant to say above that MCD is currently not in MY portfolio, but its in this portfolio. I suppose I subconsciously wanted in in my portfolio all along when I saw it in yours, and certainly over the past 45 years !!

    Sincerely,

    VTFI
    Aug 19 10:06 AM | Likes Like |Link to Comment
  • Dividend Impact Of Kinder Morgan Purchase - IF Dividends Matter To YOU [View article]
    Dear Earl:

    I am rapidly approaching the distribution phase, at least partially. I live off 20% of the dividends I am collecting, from positions in my brokerage account. In my case, I can't really defer things too much. I have to work with dividend flows that I can "see" out to five years. I anticipate that within 2-6 years, I will be retired and will need to draw on the distributions from dividend stocks within my IRA accounts. When I am 70 1/2, I will have to draw on 401Ks which I have not rolled over, since they have the stable income option that I don't want to lose.

    Sincerely,

    VTFI
    Aug 19 09:16 AM | Likes Like |Link to Comment
  • A Dividend Growth Portfolio For New Investors And Retirees Yielding 4.3%, Part 2 [View article]
    HI Dividends#1

    I really like this article. You have a consistent plan from the outset. There is nothing random or whimsical about this portfolio strategy. This is the way dividend stock portfolios are constructed. You initially select stocks from each sector which have a respectable sustained dividend and dividend growth over time, and good price performance over a long term -- 20 years in your case. It also helps to see how the stocks performed over market corrections, or under unfavorable industry or sector events, relative to other companies in the same sector. With this foundation in place, you determine going forward what you need to do to optimize the performance of the portfolio: adjusting and reallocating positions, adding new capital periodically, and really important for investors like myself-- maintaining a dependable cash flow from the dividend stream. The portfolio is also great for younger investors who have at least 20 years before they retire. I always remember when I was 15 years old I actually wanted to buy McDonalds with a small amount of money from gifts . Its not in this portfolio but I could have had dividend growth for over 50 years.

    Dividend Growth Portfolios like these do perform quite handsomely over time, and if you have a large time frame ahead of you, you could also consider separately and devote time to developing and following growth stock portfolios.

    Keep up the great work and I look forward to following your progress in the design of this portfolio. Also, good luck with your other retirement portfolio. Very interesting to follow also: link below

    http://seekingalpha.co...

    Sincerely,

    VTFI
    Aug 19 09:04 AM | 1 Like Like |Link to Comment
  • Dividend Impact Of Kinder Morgan Purchase - IF Dividends Matter To YOU [View article]
    Dear Earl:

    Congratulations on your first article. I am also interested in making numerical comparisons for different modes of managing dividend payments in my soon to be retirement portfolio. I also am monitoring the valuations of portfolio positions, and projecting cash flow from reinvesting dividends and introducing new capital into positions.

    The largest growth always comes from the largest direct or redirected dividend reinvestment as additional shares ,so I would have expected the green curve to ultimately predominate since you are growing your position more exponentially than in the other curves. In the green curve, you take the KMP distribution and reinvest in into KMI as more shares in KMI . So the green curves should ultimately exhibit the largest values since you are reinvesting KMP distributions into KMI shares and also KMI distributions into KMI shares, and KMI has the largest projected rate of dividend increase. In the red curve, KMP distributions are reinvested into KMP, shares at a lower growth rate than for KMI dividends, so ultimately, the green curve will fully exceed the red curve. The blue curve reinvests KMI distributions into KMI and retains KMP distributions as cash,and this curve should asymptotically fall between the red curve and the green curve.The cross over points exhibit the interim behaviour of all the scenarios and the shorter term advantages for cash flow. I hope I' m interpreting all this correctly. Your curves are interesting to ponder over with regard to the crossovers.

    Sincerely,

    VTFI
    Aug 18 10:14 PM | Likes Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear Be Here Now and Dividends#1:

    Yes, it was jpmist's chart. (Not mine.) And the article in which jpmist posted the link was Brad Thomas' Article on NLY:

    http://bit.ly/1BtBoT8

    This chart is extremely impressive, as I mentioned to jpmist at the time. There is an underlying excel spreadsheet which tracks the data and I suppose that it will be updated to reflect recent yield data. The graph clearly exhibits the duration of the compression. One can trace the roots of the inversion to 2005 when the Federal Reserve began raising short term rates. At one point, the 3 month bill was yielding more than the ten year note. The inverted yield curve lasted through 2007.

    I agree that this IS the worst of all possible circumstances for NLY's dividend and other mreits dividends. Its true however (as certainly many persons will not hesitate to point out) that during the 2013 Federal Reserve Taper scare, AGNC cut the dividend severely and the yield curve was not inverted. However, one has to remember that AGNC's yield had been unusually high during 2010 ( 18-20%) and the reversion to 11-12% levels should have been anticipated.

    Sincerely,

    VTFI
    Aug 18 10:26 AM | Likes Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear djrryan:

    It also can be true that if you are over-diversified, then during market corrections your portfolio might behave more like an index fund and drop the same percentage as the market. I suppose the key consideration is the STABILITY OF THE DIVIDEND. Since I will retire within the next six years, I am intent upon continuing to construct and maintain a portfolio which provides a stable cash flow under a variety of market circumstances.

    Sometimes a portfolio consisting of 3 to 4 well selected dividend paying stocks will survive market corrections, reliably pay dividends and are easier to manage provided that they are studied carefully and their valuations are tracked. In the case of the author's portfolio, AGNC happens to be a company which discloses detailed information on its portfolio holdings, and also its book value and various accounts which are the source of dividend payments. See Scott Kennedy's article

    http://seekingalpha.co...

    . MO has an impeccable track record for paying and increasing dividends.
    KMR /KMI is in the energy sector and also has a fantastic track record for paying dividends. AGNC tends to be cyclical in its price and dividend patterns (and this characteristic must be taken into account and reviewed often), whereas MO and KMR achieve continuous dividend growth.

    During a market correction, I believe that the industrials, technology, and pharmaceuticals are likely be the first sectors to be affected, and investors might seek the safety of mreits (whose underlying assets are solid) and consumer staples and energy.

    Sincerely,

    VTFI
    Aug 18 09:59 AM | 2 Likes Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear Be Here Now:

    The link for the yield curve compressions and inversions is:

    http://bit.ly/1r7jyl1

    VTFI
    Aug 17 05:14 PM | 1 Like Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear Be Here Now:

    There were other inversions since NLY went public in which the NLY dividend was not reduced substantially,or not at all. The key thing about 2005-2006 is that the inversion was persistent,that is,it lasted at least a year and a half. There is an excel plot which shows the convergence of the short term and long term rates. There is a pronounced period of inversion during which the short and long term rates compressed on each other during 2005-2006. I will now search for the plots, and get back to you and post them here. I believe they appeared in a recent article on NLY.

    Sincerely,VTFI
    Aug 17 05:02 PM | Likes Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear CharlieZap:

    I would like to point out that Cramer's sentiment about stocks could be influenced by his desire to sustain his show and its ratings. Therefore,he might have a guarded view on a sector such as mreits because they can be volatile and he does not want to jeopardize his viewership by recommending stocks like AGNC to viewers who are inexperienced investors. Preserving Mad money and the street.com are obviously going to be Cramer's number one priorities.

    Sincerely,

    VTFI
    Aug 17 08:54 AM | Likes Like |Link to Comment
  • My High Dividend Yield Retirement Portfolio Delivers 8.8% Of Income For This Retiree: Updated [View article]
    Dear mjs_28s:

    Many people ( but not all) including myself thought that an 18 - 20% yield for AGNC during 2010 was very unusual, and most sensible persons would realize that the market conditions for AGNC are cyclical and might not support that dividend indefinitely. Given that the average dividend yield over several mreits over at least several interest rate cycles is 10-15 %, I suspected that income might eventually drop due to dividend cuts. Therefore, I planned accordingly. Since I wanted to maintain my level of income, I added to my position as the AGNC price dropped along with the dividend cuts. I also made some other portfolio changes, but my goal was to maintain my dividend income level. I was fortunate that this worked!! I realize that not everyone is capable of adding to positions with more capital as the price drops, but at least they should realize that AGNC is CYCLICAL IN ITS DIVIDEND PAYMENTYS DUE TO MARKET INTEREST RATE CYCLES.If you don't like this feature of AGNC, and you believe that you will grow to expect consistent 18-20% yields when the market allows it and spend all the dividends when the market conditions are accommodative, then you should periodically re-evaulate owning and holding AGNC positions.

    Of course AGNC is an income instrument and the reason for holding it in the author's portfolio is dividend income. And since its price is always going to be cyclical, one can expect that the price will be generally range-bound. If you examine NLY for instance, the price varied between 8 and 21 over several market cycles, but the price never broke 8 or 21. Hence, if you understand this behavior, then you should plan accordingly and add or subtract from your position to achieve growth of the position during the different market phases, because you most likely won't achieve growth in my opinion if you buy and hold AGNC indefinitely, never add to the position when it is undervalued, and consistently spend all your dividends. Please see dividends#1 article on the investor mindset for investing in and managing the AGNC investment:

    http://bit.ly/WUIIqP

    For these reasons, you should hold other dividend stocks in your portfolio which are in other sectors, and which increase their dividend consistently over time and do not have "cyclical dividends".ED, MO and KMR are in the author's portfolio and are examples of these stocks.

    I certainly agree with you that your goal should be to increase your dividend income over time. You should look to increase your dividend income at least 3% per year to keep up with inflation. And of course it helps to live within your dividends, which I know is not always easily done.

    Thanks for this post on "growing accustomed to your dividends" and the
    considerations about inflation in selecting dividend stocks. I appreciate your viewpoint and these factors are indeed important in dividend portfolio design.

    Sincerely,

    VTFI
    Aug 16 01:07 PM | 1 Like Like |Link to Comment
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