Saturday, October 10, 2009

* Progress Update - September 2009

Once again it is time for a goals/progress update. I am pleased to report that annualized dividend income rose in September, extending the streak to 7 months after February's decline. Since I began publicly tracking annualized dividend income in November 2007, it has increased in 21 of the last 22 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 3,276 -0.18%
Div. Changes YTD (446) -0.38%
Sales YTD (1,811) 0.28%
September/2009 6,655 5.00%
Purchases 432 -0.05%
Div. Changes (29) -0.02%
Sales (160) 0.06%
August/2009 6,412 5.01%
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 $243, and Yield on Cost (YOC) decreased (0.01%). This month's changes were a net of new purchases, dividend changes and sales. Let's examine each of the these categories:

Purchases: The $432 increase in annual dividend income and (0.05%) decrease in YOC related to the following purchases (yield at the time of purchase):
  • $83 Johnson & Johnson (JNJ) 3.24%
  • $94 SYSCO Corporation (SYY) 3.71%
  • $255 iShares iBoxx $ Invest Grade Corp Bond (LQD) 5.46%
All the purchases, except LQD, 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 $29 decrease in annual dividend income and (0.02%) decrease in YOC related to the following dividend changes (a=dividend stated in annual terms, q=quarterly, m=monthly):
  • $5 Chevron Corporation (CVX) $0.65q>$0.68q 0.01%
  • ($2) Vanguard Inter-Term Bond ETF (BIV) $3.48m>$3.46m 0.00%
  • $9 iShares iBoxx $ Invest Grade Corp Bond (LQD) $5.56m>$5.79m 0.00%
  • ($18) Eaton Vance Tax-Adv. Global Dividend Fund (ETO) $1.65m>$1.59m -0.01%
  • ($23) Vanguard REIT Index ETF (VNQ) $2.67m>$2.32m -0.02%
Sales: The ($160) decrease in annual dividend income and 0.06% increase in YOC related to the following sale:
  • ($160) SPDR S&P Dividend (SDY) 0.06%
In September I continued the process of trimming back my ETFs/CEFs income holdings with the sale of SDY. 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 $7,000 from $6,700.

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

(Photo: sanja gjenero)