Welcome back to Dividend Dollars and our weekly review!
We saw a good amount of volatility in the market this week. The indices all ended higher. The S&P 500 tugged with its 200 day simple moving average since last week but was able to end above it this week hitting a six week high.
10 of the 11 sectors ended positive this week with healthcare being the only one to record a loss of 0.2%. The energy sector gained 7.4% and was mostly supported by crude oil which gained 10.5% for the week. The Russia-Ukraine conflict continues to keep key commodities at elevated prices.
This week Biden made appearances in Europe and Chevron received clearance to resume operations in Venezuela.
Oil and defense positions continue to crush it, but the market as whole has had two solid weeks in a row. Let’s see if it keeps up next week! Moving on to our performance now.
Portfolio Value
To date, I have invested $7,540 into the account, the total value of all positions plus any cash on hand is $8,087.95. That’s a gain of $547.95 for a total return of 7.27%. The account is up $101.64 for the week which is a 1.27% gain.
We started building this portfolio on 9/24/2021 and when compared to the S&P 500 we are outperforming the market so far! Within that same timeframe, the S&P 500 is up 1.97% whereas our portfolio has an overall return of 7.27%! Let’s keep up this good progress with smart adds to the portfolio.
We added $120 to the account this week. This week I did some reshuffling within my portfolio. I sold my positions in PB and ALL and moved that money into a new $BAC position. I did this because I don’t think ALL is set up to adjust to the changing channel environment within the insurance industry. I also believe that rising rates will be good for banks, however I wanted exposure to a larger, nationwide bank. I sold my CAH position and rolled it into an MRK position which I believe is better positioned to benefit from the growing healthcare industry. I also sold my WBA and SJM positions in order to consolidate my positions within the consumer staples industry. I used those funds to add to MRK and MO. Lastly, I also sold my small HD position simple because I felt that I was starting that position at too high an entry point. I think with pandemic easement, rising rates, and growing inflation that HD and LOW will experience some downside which is when I plan to enter.
Portfolio
Above is a dashboard of the portfolio that tracks annual dividend income, yield, beta, dividend growth, and more.
Below is a table of everything we are invested in so far. There you can see my number of shares, shares bought through dividend reinvestments, average cost, gains, and more. The tickers in green are positions that I bought shares in this week.
This week our annual dividend income dropped by $9 as a result of the AT&T dividend cut following the Warner spinoff planned for next month. Our dividend yield decreased by 0.22% and our beta increase by 0.01. My portfolio’s dividend yield may be just slightly higher than what you will see in other portfolios, however that is strategic per my time horizon. I am in my 20s and am just starting off this investment journey, so a higher dividend yield gives me greater cash flow now to reinvest which helps me realize the benefits of compounding sooner.
Our beta usually hovers right around the mid 0.6s which is good, especially in times of uneasiness. It means my portfolio won’t dip as much as the rest of the market on red days, however, it does go the other way around and I won’t have as much green on the good days. Therefore, it is good to watch your beta in terms of cyclicity. View the chart above to see the performance of my portfolio versus the S&P 500, notice how my portfolio’s green days are not as substantial as the S&P’s but neither are my red days, that is beta at work. My beta so far has led to better returns than the market since beginning this portfolio, however, on rally weeks I underperform. In order to combat that, I am going to start adding to a levered position to raise my beta. I would like to see it in the 0.8s.
Dividends
This week we received two dividends: one from HD for $0.57, this was not reinvested, and the other from LMT for $5.64 to be reinvested on Monday.
Dividends received for 2022: $63.48
Portfolio’s Lifetime Dividends: $86.40
Trades
As detailed above, we did some restructuring in the portfolio this week. We also had some option activity.
Here’s the breakdown of the trades I made this week:
- March 21st
- APD – added 0.3 shares at $234.80
- XYLD – added 0.20491 shares at $48.80 (recurring investment)
- SMHB – added 1 share at $11.22
- March 22nd
- ALL – sold 2 shares at $137.10
- PB – sold 2 shares at $71.45
- CAH – sold 2.018676 at $57.48
- WBA – sold 2.029713 at $47.23
- SJM – sold 1.511712 at $129.87
- BAC – bought 8 shares at $43.93
- MRK – bought 3 shares at $79.36
- MO – added 2 shares at $53.12
- MKC – added 1 share at $96.10
- March 23rd
- HD – sold 0.5 shares at $317.78
- MMM – added 0.4 shares at $148.15
- CMCSA – added 1 share at 46.82
- O – added 0.3 shares at $67.03
- UWMC – added 3 shares at $4.55
- SCHD – added 0.127976 shares at $78.14 (recurring investment)
- March 24th
- UWMC – opened a $4.5 4/14 covered call for $18 premium
- BBY – added 0.4 shares at $96.05
- March 25th
- UWMC – closed position at $12
- SNDL – opened $0.5 4/8 put position at $3
- O – added 0.5 shares at $67.56
Summary
That is it for the update this week. Let’s kill it next week. Stay patient and be ready to buy income producing assets at a discount!
Let me know what you think of the progress so far, share with me your progress and questions, interact with me on twitter and Instagram using the links below!
Thank you for reading! See you next week!