Portfolio edged up 2.16% in January. Income for 2017 is currently projected to be up 15.7% from the income received in 2016 if everything remains at current levels. Any additional dividend drips or share purchases would increase that projected income. Any dividend drops or share sales would lower the projection amount
Tomorrow MPLX goes X-Div and Friday ETE goes x div-EVA goes X-Div FEB 13–UTF X-Div Feb 14-NRZ X-Div Mar 23
Of the above 5 companies listed MPLX-EVA-NRZ just increased the distributions and UTF just paid a year end extra dividend of $0.432. HASI just paid a dividend in early Jan that was increased 10% over 2016 and in addition management announced that all 2016 distributions paid were 100% tax deferred.
So without much excitement (And sometimes without capital gain growth) my portfolio quietly, without anyone noticing or paying attention, continues to throw off money to me. And that’s fine, because I don’t like excitement.
You should think about doing a blog or a website on this. I’m serious.
I think you would help a lot of people that need to build their wealth the way you are doing.
I’m really fascinated. I’d like to at least put a portion of my portfolio in this direction.
I’m not sure if this was asked, but have you looked into MLP ETFs, and if so, what are your thoughts. Better to buy the individual companies over the ETFs?
You should think about doing a blog or a website on this. I’m serious. I think you would help a lot of people that need to build their wealth the way you are doing.
Thanks for the kind words.
I’m retired for over 13 years and I’m 83 years old.At this stage of my life I am not planning on looking for more things for me to do. I write on message boards because years ago when I first retired I got help on a message board from someone that was willing to help when I knew virtually nothing. I listened and adapted as best I could. In my own way I am trying to pay back the debt I incurred from my mentor. But the work has to be done by you and/or anyone else out there that thinks there is any merit in what I say.
I’m really fascinated. I’d like to at least put a portion of my portfolio in this direction.
You might be fascinated–But so far are you courageous enough to make the first step??
The first step is to identify the worst security in your own portfolio and sell it and use the proceeds to add to your best security currently in your portfolio. That one step will immediately make your portfolio better for you. --If the security you are adding is a small capitaliZation stock, that would be even better. If it pays a dividend, that is even more better–If the dividend is partially or wholly tax deferred, that is even better more for you.
The first step is to identify the worst security in your own portfolio and sell it and use the proceeds to add to your best security currently in your portfolio.
b&w,
How do you determine the best security and the worst security in your portfolio? You’ve said this many times, but I haven’t seen you say how. That is nearly the entirety of what we do here at Saul’s Investing Discussions: try to identify the best securities and avoid the worst. To most of us, it is very difficult.
How do you determine the best security and the worst security in your portfolio? You’ve said this many times, but I haven’t seen you say how. That is nearly the entirety of what we do here at Saul’s Investing Discussions: try to identify the best securities and avoid the worst. To most of us, it is very difficult.
Good question. The answer is very simple. Your best stocks are those that made you money in the past. Your worst stocks are those that lost you money looking backwards.
How do you determine the best security and the worst security in your portfolio? You’ve said this many times, but I haven’t seen you say how. That is nearly the entirety of what we do here at Saul’s Investing Discussions: try to identify the best securities and avoid the worst. To most of us, it is very difficult.
Excellent question.
The best way to determine that is to determine what YOUR goals are-Not everybodys goals-Not Saul’s Goals -Your OWN PERSONAL goals.
For example “I want to make money” is not IMHO a goal.
If you said I am making $75K a year-and I want to retire in 5 years and I want to replace my $75K in work earnings to portfolio earnings of $75K and I have $250K in my portfolio and the portfolio doesn’t make much because whatever I buy doesn’t work out for me. The goals I see there-You are seeking income to replace your work income and your portfolio managing isn’t moving you towards that goal currently. If your goal is income, Your worst stock in your personal portfolio are stocks that don’t pay income and if they haven’t appreciated in value during your ownership.
Don’t expect every decision you make to be 100% correct. But in time you should see improvement if you pay attention and stay away from the excitement of everyone buying AAPL-FB, AMZN and others. If you want to be a big hit at cocktail parties buy those. If you truly want to convert work income into portfolio income learn how to avoid those
To sum up- The worst security IN YOUR PORTFOLIO IS THE ONE THAT IS NOT DOING WHAT YOU BOUGHT IT FOR AND IS THEREFOR NOT HELPING YOU REACH YOUR GOALS–THE BEST SECURITY IS THE ONE THAT IS DOING EVERYTHING YOU WANTED IT TO DO, TO HELP YOU REACH YOUR GOALS-
Clues to reinforce your thinking if you do it correctly. You will find some securities you own are being taken private or merged–You will find securities you own for 1 or 2 years that start to get media attention and you look in your portfolio and see you are already sitting with a 5 Figure income stream received and a 5 or 6 Figure capital gain. that’s when you will know your portfolio is working for you and not wall street.
Income for 2017 is currently projected to be up 15.7% from the income received in 2016
What was your overall return (CAGR), or Income, in 2016? Percentages are fine.
HASI just paid a dividend in early Jan that was increased 10% over 2016 and in addition management announced that all 2016 distributions paid were 100% tax deferred.
HASI is up 65% over the past 10 years, equivalent to an CAGR of 5.1%. It’s dividend at today’s price is about 7.12%, which as you point out for is tax deferred (not tax free) until this year (2017).
What was your overall return (CAGR), or Income, in 2016? Percentages are fine.
I received 24.84% more income in 2016 than 2015. However my portfolio was impacted in 2016 by a HUGE Tax payment (for me that required a large capital withdrawal of funds) This was from the MWE-MPLX merger in Dec 2015 that was partly taxable. I estimate the income with a more normal withdrawal would have been 30% or 31%. However in full disclosure you have both figures and you are free to use either one
HASI is up 65% over the past 10 years, equivalent to an CAGR of 5.1%. It’s dividend at today’s price is about 7.12%, which as you point out for is tax deferred (not tax free) until this year (2017).
I don’t know where you are getting these figures from HASI has only been public for about 4 years
The tax deferral was 90% in 2014
77% in 2015
and 100% in 2016- Whatever the deferral will be in 2017, will be announced in Jan 2018.
And they raised the quarterly dividend each year in December-Dec 2014 raised to $0.26-Dec 2015 to $0.30–Dec 2016 raised to $0.33
b&w, I’m interested in absolute rate of return, not relative - at least that’s the number we use here, and the number that’s important for understanding whether one can earn enough from a portfolio to retire on.
HASI has only been public for about 4 years
My bad - I hit the 10year link in Google Finance and didn’t pay attention to what was actually returned. The 4 plus length of being public puts the CAGR at about 11.25% without dividends. So adding in the 7.1% current dividend rate (at today’s stock price) is a pretty sweet total return per year.
So your scenario you gave in no way fits my situation. At he moment I only own 7 stocks.
My top holdings are the opposite of an MLP. Thy are FB, AAPL, and AMZN. I’ve held them for years, FB since the IPO. I’m not selling.
What I want to do is diversify somewhat. I consider all 7 holdings to be core holdings and until I feel otherwise I’m not selling. I also have a large cash position that I want to put to work at some point. I have a few limit orders in, but I’m thinking that an MLP might be a good way to diversify.
Another question I asked, how do you feel about MLP ETFs. Any thoughts?
I’m also looking at MMP. Any thought on this one?
My issue is that I never hold more then 10 or 12 stocks, and I buy big positions. So in order to difersify within the MLP sector is is better to buy an MLP ETF, or do you still think it’s better to just buy a couple of Individual MLPs.
Another question I asked, how do you feel about MLP ETFs. Any thoughts?
Personally I stay away from the MLP funds. I prefer the individual companies. MLP’s are a tax shelter and therefor belong in a taxable account and all their distributions are tax deferred. There is sometimes a limited amount of income that is taxable but so far not much. MMP is a good company which translates into a low yield of 4.2%
I own 3 MLP’s
ETE I own about 12 years Yields about 6.159%. One of their subsidiaries is building the DAPL in North Dakoda where they just had the Protest by the indians holding up the completion. It appears the pipeline will get the final go ahead–AGAIN–to complete the pipeline. Should be a massive positive for the company. (5th largest holding)
MPLX–I owned MWE for about 13 years big winner- 5.53% yield MWE merged with MPLX (A subsidiary of Marathon Petroleum Corp) and I’ve been adding ever since (Largest holding in portfolio)
EVA -I own 1 1/2 years 8.56% yield–Clean energy-Wood pellets.
I think you mean you are interested in relative not absolute rate of return.
No, I meant what I said. B&W said he did 24.84% better in 2016 than 2015, but since I don’t know what his returns were in 2015 that doesn’t help me decide if I want a portfolio like his.
No, I meant what I said. B&W said he did 24.84% better in 2016 than 2015, but since I don’t know what his returns were in 2015 that doesn’t help me decide if I want a portfolio like his.
Portfolio income was 8.59% higher in 2015 than 2014.
I assume that you are aware that all the numbers and percentages that I have listed are after all my living expenses-donations-gifts and TAXES are removed from the portfolios. Remember I have no pension- and only limited SS due to income. As I mentioned previously 2017 income is projected to be about double my currently increasing cost of living. That means about 50% of the income received will be reinvested for additional income and the balance will be removed for expenses (OF ALL KINDS-INCLUDING TAXES)
And I am sure you noticed that I haven’t said one word about Capital gains or price appreciation so far in this post.
That is another moving part to my portfolio that you might want to consider --Since the Nov 8, 2016 Election, my income oriented portfolio has had capital appreciation of 13.343%
Portfolio income was 8.59% higher in 2015 than 2014.
I believe that his point is we have no idea what the baseline is here. 8.59% higher is a very different number if your income in 2014 was 1% of your portfolio than if it was 10% or 20%.
And, just to make sure that we are on the same page, are you saying that:
And, just to make sure that we are on the same page, are you saying that:
PortfolioIncome = Total Gains - ExpensesEtc.
I’ve been intrigued by all of these posts. I think the key point many of us are trying to understand is what percentage of the portfolio is thrown off as income. It doesn’t matter if this year’s percentage was greater than or less than last year’s percentage.
The problem here is that the portfolio is constantly changing in value. So maybe we can use just one point in time…let’s say the beginning of the year.
So, the question for B&W is the following. What is the income you received in 2016 divided by the value of your portfolio to start 2016?
So, the question for B&W is the following. What is the income you received in 2016 divided by the value of your portfolio to start 2016?
I have answered that question on this board at least once and maybe more.
Here is the answer again if you missed it or never read it because you entered the thread in the middle
====The income received in 2016 divided by the value of the portfolio to start 2016 is 7.17%====
Am I looking at this too simply?
I believe you all are. The point is —The growth of the portfolio over the past 13 1/2 years has produced an income for me today that is more than double my needs after paying all my bills for the entire 13 1/2 years. the portfolio in the 13 1/2 time frame is currently 13 times the original value and that is after deducting all my various expenses for all the years that currently total 3 1/2 times the original value.
The excess income above my needs are reinvested to produce even more income to cover inflation and any higher expenses that become necessary.
And, just to make sure that we are on the same page, are you saying that:
PortfolioIncome = Total Gains - ExpensesEtc.
How about if we do it this way.
1)Let’s say Portfolio Income is all dividends/distributions received during the calendar year
2)Expenses are anything I spend during the same year
3)My total expenses are currently running less than 50% my portfolio income
4)The excess income received above the “less than 50% spent” is reinvested into additional shares to grow the portfolio and further increase the income to cover coming increases in the cost of living I anticipate for the future.
It all still boils down to picking the right investments, no matter what path you choose - growth, income, etc…
And that ain’t easy, but it’s not impossible either.
You are right it ain’t easy but not impossible—But IT IS EASIER THAN YOU THINK.
Your problem and most others have the same problem–Is you are trying to find the PERFECT STOCK AND YOU STUDY THE HISTORY AND somewhere along the line you decide THIS IS IT=THIS is the one I’m going to put my money in- And actually what has happened -A number of people with different objectives have looked at one stock and all have convinced each other that it is the greatest stock. My question the greatest for WHO??? The company or THE GREATEST FOR YOU???
ANY stock I buy COULD MAKE ME A MILLION DOLLARS OR MORE if it works out-- However When I start to buy it. all I’m buying is 100-200-300 shares and it pays a growing dividend . As time goes on as it proves itself in my portfolio I allocate additional cash. If it doesn’t make me money it gets no more money from me and if necessary it gets sold. Stocks that perform get additional monies For example-Take HASI as an example. I own it in 4 accounts-but we’ll talk about 1 because they are similar I started buying HASI on Feb 9, 2015 at $14.31 In the 2 years since I have added 17 more cash purchases plus 4 dividends were dripped and cash taken for the others in that account. Stocks like this will move the needle of my portfolio while an AMZN and Chipolte and AAPL will not. If I’m wrong along the way I will sell probably have a big chunk of change to move on to something new.
The questions you have to ask yourself–How many shares of an AMZN will you buy at $850 and are you willing to stomach a $30 loss per day for a few days? And if it doubles in price HOW MUCH WILL YOU MAKE BASED ON THE LIMITED NUMBER OF SHARES OWNED-No income is paid along the way so the only thing you can hope for is capital gains. HASI on the other hand has paid me about 12% in the 2 years which I have added additional shares. HASI and the other securities in my portfolio have collectively paid all my bills for those 2 years–Even if I have to take a loss down the road I have at least the 12% additional share as a cushion.
I believe dividends/distributions are more stable than share price. If a company cuts the dividend it is an important move. Share prices can fluctuate 10%-20% or more and could be only street noise.