What I Did During the Market Slide

28 Jan 2016 23:06

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After a two week slide the markets have leveled off trading in a sideways pattern and investors can catch their breath. Through this whole slide I remained perfectly calm and did not panic sell any of my holdings. And what happened to my portfolio during this time? Well here is a summary:

Annual Dividend Income Increase 0.5% - While the market was declining my annual income actually increased for doing nothing but sitting on my ass thanks to dividend increases from General Motors (GM) and Omega Healthcare Investors (OHI). How I love this aspect of dividend growth investing!

Annual Dividend Income Increase 0.07% - My forward annual dividend increased a smidge thanks to auto reinvesting some of my dividends and with declining share prices they reinvested at an extremely nice price.

Annual Dividend Income Increase 2.69% - I wouldn’t say the market was extremely undervalued so I did not dump every dollar to my name into the market. However, there were definitely some nice bargains to be had so I did invest in two securities that provided a dividend yield of 3.85% with lots of room for future growth.

The end result saw my overall annual dividend increase by 3.26%. My goal for 2016 is to grow my annual dividend by 15%, in less than 1 month I knocked a pretty good chunk off. I doubt every month will be like this but a few more times would be nice.

Beyond my dividend growth, I am proud of how cool and collect I was during the whole event and I can give credit primarily to the fact that I have a diversified and balanced portfolio of companies with strong balance sheets. If I was over-weight in materials or energy holdings this would be an entirely different post

I am not trying to brag of success while others are struggling. This post is more about reinforcing the benefits of dividend growth investing, keeping to a plan, and not getting greedy by chasing high yields which can lead to steady and consistent growth. Of course the down side is when the market surges my portfolio misses out on massive gains but I’ll take the trade-off knowing that it reduces the stress related to investing.

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