Quarterly Portfolio Update

27 Dec 2013 15:35

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Quarterly Dividend Growth
% from Div Growth 3.56%
% from New Investments 18%
% from Reinvested Div 0.00%
% Overall Growth 21.56%

This is my second quarter utilizing a DGI strategy and time to measure growth. In early November I completed the remainder of my portfolio rebalancing with the purchase of Ensco Plc (ESV). I was also able to re-invest the last quarter dividends by buying additional shares of the utility company PPL to level off my diversification into utilities but that purchase did not contribute to this quarter for dividend growth.

For the quarter there were four stocks that contributed to passive growth; Microsoft (MSFT), Seagate (STX), BP Plc (BP), and Prospect Capital (PSEC).

MSFT continues its historical dividend growth but surprised investor with the size of the increase which came in at a whopping 21.7% increase. Personally I was expecting between 9-12% so this was a nice Christmas present. Additionally MSFT has been firing on all cylinders in the last quarter of 2013 with brisk sales of enterprise solutions, Xbox One, Surface 2, and Windows Phone products. A year ago I saw the potential of Windows 8 commonality across devices and jumped on MSFT for this reason and so glad I jumped in when I did. Even though MSFT has seen a run-up in share price this year I still like the stock as long as it yields at least 3%.

STX continues to be a star in my portfolio as they increased their dividend by 13.16% and I’m looking at a capital gain of 120% in just one year. Though the stock has become expensive for me to consider adding additional shares I do not plan on selling as their strategy for SDD, HDD, and cloud storage appears strong and I foresee continued dividend growth going forward.

BP has slowly been coming off of its Gulf disaster and starting to see light at the end of the tunnel by rewarding investors with a 5.15% increase in dividends. While this is below my minimum 7% growth rate I purchased BP with the hope that as more of the liability of the Gulf incident decreases the dividend increases will start to exceed my minimum.

PSEC increases were minimal from month to month but I bought this as a high income dividend payer positioned for a rising interest rate environment and to date PSEC has not disappointed.

As far as additional contributions I only managed to save $140 this quarter. In my house we have quite a few computers (3 kids plus me & the Missus) so I switched to a free anti-virus software package which detected more viruses, malware, and tracking cookies than our current software. By not renewing our software it saved $140 which I redirected to the portfolio.

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