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August 2020 Dividend Stock Purchases

Sep. 01, 2020 8:49 AM ET2 Comments
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  • August marked another month of minimal capital deployment as I deployed $359.09 of capital during the month.
  • The $14.07 in annual forward dividend income added was more than offset by the $20.66 net decline in annual forward dividend income as a result of dividend announcements.
  • After months of reduced capital deployment, I am only a few paychecks away from reverting back to my usual capital deployment schedule of $1,500-$2,000/month.

I'm gradually building my position in Capital Income Builder (CAIBX) within my retirement account as I'm continuing to deleverage my Robinhood margin and pay off credit card debt.

This month was another month of relatively little activity in terms of capital deployment, but with each passing month, I am getting closer to resuming my previous capital deployment of $1,500-$2,000/month.

With that aside, I'll delve into my dividend stock purchases for the month of August 2020.

As shown above, between my 7% gross contribution and my employer's 3% match on the contributions, I was able to contribute gross capital of $293.34 and $280.13 in capital net of sales charges to my retirement account.

These contributions to my retirement account helped my CAIBX position grow by 4.727 shares from 120.546 entering into August to 125.273 shares entering into September.

Factoring in $2.14 in annual forward dividends/share, the additional 4.727 shares of CAIBX boosted my annual forward dividend income by $10.12, which equates to a net yield of 3.61%.

When also including the $78.96 reduction in my Robinhood margin from $1,762.87 at the start of August to $1,683.91 at the end of August, my annual forward dividend income increased by $3.95 (given the 5% cost of capital for Robinhood margin).

Concluding Thoughts:

Overall, I deployed $359.09 in capital (including dividend reinvestment) during the month of August 2020 and added $14.07 in annual forward dividend income as a result of my capital deployment, which works out to an average yield of 3.92%.

When also factoring in the dividend announcements during the month of August, my annual forward dividend income is down just under $7 and I am about 2.2% off of my all-time high annual forward dividend income of $1,252.

Given that I would like to have most of my $4,000 in debt paid off before I refocus on investing, it will be a few more paychecks before I am able to revert to my previous $1,500-$2,000/month capital deployment schedule.


Did you experience any dividend cuts during August like I did with GEO and BP?

How was your month in terms of capital deployment?

As always, I thank you for your readership and look forward to reading your comments in the comment section below!

Analyst's Disclosure: I am/we are long CAIBX, BP, GEO, MO, LOW.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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