Saturday, August 8, 2009

* Progress Update - July 2009

Once again it is time for a goals/progress update. I am pleased to report that annualized dividend income rose in July, extending the streak to 5 months after February's decline. Since I began publicly tracking annualized dividend income in November 2007, it has increased in 19 of the last 20 months.

My goals were defined in this December 1, 2007 Investing Goals post and updated in my 2009 Investing Goals post. Below is an updated version of the table found in the original post.
Description Dividend
on Cost
2027 Goal 110,000 20.00%
2017 Goal 30,000 10.00%
2009 Goal 8,000 5.00%
December/2008 5,636 5.28%
Purchases YTD 2,302 -0.07%
Div. Changes YTD (402) -0.35%
Sales YTD (1,399) 0.07%
July/2009 6,137 4.93%
Purchases 350 -0.02%
Div. Changes (31) -0.03%
Sales (116) 0.10%
June/2008 5,934 4.88%
The above information covers the current month and year-to-date through the current month.

Click here for a Detailed Historical Progress Table.

For the month, annualized dividend income increased $203, and Yield on Cost (YOC) increased 0.05%. I finally crossed the elusive $6,000 mark. Hopefully, more stable markets and fewer dividend cuts will allow me to reach the $7,000 level more quickly. This month's changes were a net of new purchases, dividend changes and sales. Let's examine each of the these categories:

Purchases: The $350 increase in annual dividend income and (0.02%) decrease in YOC related to the following purchases (yield at the time of purchase):
  • $53 Nucor Corp. (NUE) 3.42%
  • $103 Emerson Electric Co. (EMR) 4.16%
  • $194 Vanguard Long-Term Bond ETF (BLV) 5.49%
All the purchases, except BLV, lowered my YOC. 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 $31 decrease in annual dividend income and (0.03%) decrease in YOC related to the following dividend changes (a=dividend stated in annual terms, q=quarterly, m=monthly):
  • $3 Canadian National Railway Company (CNI) $0.200q>$0.217q 0.00%
  • $2 Vanguard Long-Term Bond ETF (BLV) $4.02a>$4.04a 0.00%
  • $1 Realty Income Corp (O) $0.14206m>$0.14237m 0.00%
  • ($4) iShares Investment Grade Corp. Bond (LQD) $5.80a>$5.58a 0.00%
  • ($12) SPDR S&P Dividend (SDY) $2.15a>$2.00a -0.01%
  • ($21) Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund (ETO) $1.78m>$1.71m -0.02%
Sales: The ($116) decrease in annual dividend income and 0.10% increase in YOC related to the following sale:
  • ($116) Vanguard High Dividend Yield Indx ETF (VYM) 0.10%
In July I continued the process of trimming back my ETFs/CEFs income holdings with the sale of VYM. I will continue to reduce my holdings in this area each month.

Based on year-to-date results, I am going to raise my revised estimate of annualized dividend income on December 31, 2009 to $6,500 from $6,300.

That's it for this time. The next monthly progress update will be early September.

(Photo: sanja gjenero)