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Saturday, August 7, 2010

* Progress Update - July 2010

Once again it is time for a goals/progress update. I am pleased to report that annualized dividend income increased in July, starting a new streak of 1 consecutive months of increases after June 2010's decline. Since I began publicly tracking annualized dividend income in November 2007, it has increased in 30 of the last 32 months.
My goals were defined in this December 1, 2007 Investing Goals post and updated in my 2010 Investing Goals post. Below is an updated version of the table found in the original post.


Description Dividend
Income
Annualized
Yield
on Cost
2027 Goal 110,000 20.00%
2017 Goal 30,000 10.00%
2010 Goal 9,500 5.00%
December/2009 7,274 4.84%
Purchases YTD 2,306 -0.17%
Div. Changes YTD -100 -0.03%
Sales YTD -175 -0.01%
July/2010 9,305 4.63%
Purchases 451 0.03%
Div. Changes -24 -0.02%
Sales 0 0.00%
June/2009 8,878 4.62%
The above information covers the current month and year-to-date through the current month.
For the month, annualized dividend income decreased $427, and Yield on Cost (YOC) increased 0.01%. This month's changes were a net of new purchases and dividend changes (no sales for the month). Let's examine each of the these categories:
Purchases: The $342 increase in annual dividend income and 0.07% decrease in YOC related to the following purchases (yield at the time of purchase):

  • $201 AT&T, Inc. (T) 6.91% [Analysis]
  • $177 Cincinnati Financial Corp. (CINF) 5.83% [Analysis]
  • $73 Wal-Mart Stores Inc. (WMT) 2.45% [Analysis]
T and CINF increased my YOC, while WMT lowered it. As noted in earlier updates, I generally expect YOC to drop each month since most new investments will yield less than my current YOC, and dividend increases will not be sufficient to offset it.
Dividend Changes: The $24 decrease in annual dividend income and the 0.02% decrease in YOC related to the following dividend changes (a=dividend stated in annual terms, q=quarterly, m=monthly):

  • ($9) MLP Infrastructrue ETN (MLPI) $1.63a>$1.55a
  • ($5) Invest Grade Corp Bond (LQD) $5.59a>$5.53a
  • ($2) Intermediate-Term Bond ETF (BIV) $3.43a>$3.41a
  • ($4) U.S. Preferred Stock Index (PFF) $2.33a>$2.26a
  • ($2) Long-Term Bond ETF (BLV) $3.95a>$3.94a
  • $1 Realty Income Corp. (O) $0.14331q>$0.14362q
  • ($3) Emerging Markets Sovereign Debt (PCY) $1.66a>$1.65a
Sales: There were no sales during the month.

With this month's strong recovery, I still on target to achieve my goal of an annualized dividend income of $9,500 by December 31, 2010 and could achieve it as early as next month. I continue to believe annualized dividend income of $10,000 by December 31, 2010 is still obtainable, assuming minimal future sales and dividend cuts.
That's it for this time. The next monthly progress update will be early September.
(Photo: sanja gjenero)

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