Friday, July 1, 2016

Monthly Review: June 2016

This month I initiated my first option trades in DivGro, one covered call and one cash-secured put. I've been trading options for several years, though not within the context of my dividend growth portfolio. One of my goals this year is to find opportunities to generate extra income with options. Selling options and collecting the premiums provide a nice way to boost dividend income.

Market volatility increased in June due to Brittain's so-called Brexit vote and the somewhat unexpected result. I'm quite happy to report that DivGro outperformed the markets in June, gaining 2.04% versus 0.80% for the Dow and only 0.09% for the S&P 500.

A fellow dividend growth investor and blogger, Investment Hunting, is running a blogger interview series in which he asks DGI bloggers a series of about 20 questions. I decided to participate and reveal a little more of my background and what I do for a living. You can read the interview here.

I took some time off in June to attend the premiere of Piper, an animated short film I've been working on for the last year or so as Effects Supervisor. It was great to go to Annecy in France to screen the film at the Annecy International Animated Film Festival.

My wife and I used the opportunity to travel a little in France and Spain. It was a wonderful trip! We saws so many amazing things, including the Mona Lisa and the Venus de Milo in the Louvre in Paris, the Black Madonna at Monserrat in Spain, the Basilica of the Sagrada Familia in Barcelona, the Dalí Theatre-Museum in Figueres, and the medieval city of Carcassonne. We also visited the Villa Lumière, now a museum celebrating the inventions of Antoine Lumière and his two eldest sons, Auguste and Louis, the inventors of the Cinematograph.

June Highlights

I recorded dividend income totaling $1,338 this month, a new record for monthly dividend income for DivGro! I received dividends from now fewer than 35 stocks! Dividend income in June was 78% higher than last month's total, while the year-over-year increase is 45%.

Here is DivGro's projected monthly dividend income (red line) plotted against monthly dividends:


Comparing dividend income by month is another way to see progress:


Transactions:
  • Purchases
  • Sales
    • None
  • Dividends
    • 2016-06-01: Cash Dividend Received AFL: $20.50
    • 2016-06-01: Cash Dividend Received CMI: $42.90
    • 2016-06-01: Cash Dividend Received HP: $48.13
    • 2016-06-01: Cash Dividend Received INTC: $26.00
    • 2016-06-01: Cash Dividend Received INTC: $31.20
    • 2016-06-01: Cash Dividend Received F: $90.00
    • 2016-06-01: Cash Dividend Received NPM: $25.20
    • 2016-06-01: Cash Dividend Received PFE: $30.00
    • 2016-06-06: Cash Dividend Received WMT: $17.00
    • 2016-06-07: Cash Dividend Received JNJ: $24.00
    • 2016-06-07: Cash Dividend Received JNJ: $19.20
    • 2016-06-09: Cash Dividend Received MSFT: $28.80
    • 2016-06-10: Cash Dividend Received WBA: $15.84
    • 2016-06-10: Cash Dividend Received TGT: $22.40
    • 2016-06-10: Cash Dividend Received IBM: $42.00
    • 2016-06-10: Cash Dividend Received XOM: $48.75
    • 2016-06-10: Cash Dividend Received CVX: $53.50
    • 2016-06-13: Cash Dividend Received MMM: $17.76
    • 2016-06-15: Cash Dividend Received MAIN: $41.40
    • 2016-06-15: Cash Dividend Received O: $19.90
    • 2016-06-15: Cash Dividend Received AVA: $25.69
    • 2016-06-15: Cash Dividend Received MDP: $27.23
    • 2016-06-15: Cash Dividend Received STAG: $27.80
    • 2016-06-17: Cash Dividend Received MAIN: $63.25
    • 2016-06-17: Cash Dividend Received RS: $16.00
    • 2016-06-20: Cash Dividend Received D: $25.20
    • 2016-06-20: Cash Dividend Received MCD: $24.03
    • 2016-06-21: Cash Dividend Received VLO: $43.20
    • 2016-06-22: Cash Dividend Received NOC: $14.40
    • 2016-06-22: Cash Dividend Received QCOM: $53.00
    • 2016-06-24: Cash Dividend Received NIE: $112.48
    • 2016-06-24: Cash Dividend Received LMT: $23.10
    • 2016-06-29: Cash Dividend Received GILD: $23.50
    • 2016-06-29: Cash Dividend Received TROW: $35.10
    • 2016-06-30: Cash Dividend Received EXG: $40.65
    • 2016-06-30: Cash Dividend Received UNP: $30.80
    • 2016-06-30: Cash Dividend Received TRV: $19.43
    • 2016-06-30: Cash Dividend Received ES: $26.70
  • Deposits
    • 2016-06-01: Option Income Cash Deposit: $315.49
    • 2016-06-16: Option Income Cash Deposit: $361.75
    • 2016-06-22: Passive Income Cash Deposit: $383.17
    • 2016-06-29: JULY Cash Deposit: $1,500.00

    Changes in Projected Annual Dividend Income (PADI):
    • From Purchases
      • The purchase of 35 WMT shares added $70.00.
      • The purchase of 54 WFC shares added $82.08.
      • The purchase of 47 NKE shares added $18.80.
    • From Increases
      • HP's dividend increase added $3.50.
      • TGT's dividend increase added $6.40.
      • O's dividend increase added $0.60.
      • WPC's dividend increase added $0.93.
    • PADI increased by $514.91 to $11,576.38.

    Dividend Summary:
    • Dividend income last month: $751.44
    • Dividend income this month: $1,338.27
    • Total dividend income year-to-date: $9,595.66
    • Total dividend income all-time: $22,797.20

    Markets:
    May 31, 2016
    DOW: 17,787.20S&P 500: 2,096.9510-YR BOND: 1.83%
    Jun 30, 2016
    DOW: 17,929.99S&P 500: 2,098.8610-YR BOND: 1.49%

    In June, the Dow gained 0.80% and the S&P 500 gained 0.09%, while DivGro gained 2.04%.



    Portfolio: Here is a snapshot of DivGro's state on 30 June 2016:



    Goals Report

    I've set some challenging goals for 2016:
    1. PADI: Increase projected annual dividend income to $12,000.
    2. Dividends: Earn $10,800 in dividend income.
    3. Posts: Post 120 articles on my DivGro blog.
    4. Seeking: Write 52 premium articles for Seeking Alpha.
    5. DivNet: Write 8 articles for The DivNet.
    The last gauge is a reference – it indicates where the other gauges should be after 182 out of 366 days. I'm ahead of schedule with all my goals except for #5. 

    Looking Ahead: I have enough funds available for 4 buys, so I'll be looking for opportunities to either add to existing positions, or to open new positions. Another thing I'd like to do this month is to evaluate the stocks in DivGro to see which positions are not performing as expected. With the markets trending higher again after the Brexit vote, perhaps a little consolidation would be in order.

    Please see my Performance page for various visuals summarizing DivGro's performance.

    Thanks for reading and take care, everybody!

    18 comments :

    1. You have a nice snowball growing. Grats on the option trade...my wheelhouse!

      ReplyDelete
      Replies
      1. Thanks, Velociraptor -- nice name BTW! Yeah, options are certainly not yet in my wheelhouse, so I'll check out your blog to learn more...

        Cheers
        FerdiS

        Delete
    2. Wow Ferdi. It sounds like June was a great month for you all around. Congrats on your massive monthly dividend income and on Piper. It's a fantastic short film. Lastly, Thanks again for participating in my blogger interview series.

      ReplyDelete
      Replies
      1. Thanks, IH! We had a great month of June, alright! Feeling blessed... I'm glad you liked Piper. With it being connected to Finding Dory, which is doing so well, lots of people are getting to see it!

        You're most welcome about the blogger interview series -- I'm happy to participate and very excited that you're running the series. It'll help to create a more close-knit community.

        Delete
    3. That is a good looking month for DivGro. The power of compounding is a beautiful thing. Those are some big goals that you but thats ok because its better to aim for the moon and land among the stars.

      Congrats on your film doing so well. Do you have any film projects planned in the near future?

      ReplyDelete
      Replies
      1. Thanks for visiting and commenting, More Dividends. I just love the power of compounding. This year, due to a reprioritization of our budget, we're adding $2,000 of fresh capital monthly (vs $2,500 monthly, last year). Fortunately, by now, monthly dividend income makes up the difference!

        Thanks so much for your kind words. I'm glad to have contributed to both films (Piper and Finding Dory), although I spent much more time on Piper than Finding Dory. Our studio always has several film projects in the pipeline, but much of it is, of course, secret!

        Take care
        FerdiS

        Delete
    4. You're killing it. I can't wait till the day I'm making $1000+/month !

      ReplyDelete
      Replies
      1. Thanks, Captain Dividend -- things are going along great! Just keep at it and you'll be there in quick time. Best of luck!

        FerdiS

        Delete
    5. Woo hoo! Options! I really think they're a great way to boost income, without really taking on any more risk (so long as you do it right...). I recently moved my largest account to Interactive Brokers so that I could enhance my dividend growth strategy with options. IB is the way to go. Those fees you're paying are too high. They cut into the premiums too much.

      ReplyDelete
      Replies
      1. Thanks for the advice on Interactive Brokers. I've been thinking about doing so myself! Moving to a platform that charges so much less than Scottrade would certainly help a lot.

        One thing to note: Scottrade just reduced the per option commission to 70¢. That's certainly better than the $1.25 they charged before. Still, paying $7.00 plus 70¢ per option in commissions is quite a bit higher than IB's commission.

        Delete
      2. I need to move my money over to IB. I pay $9.71 per trade with Schwab. Since I close most options before expiration it's times two. I haven't switched yet because IB doesn't offer drip investing, but I think it's time. Catfish Wizard, how is the IB interface? Do you like the overall platforms?

        Delete
      3. Yeah I went through the same thing with CapitalOne investing. $6.95 base trade + $0.75/contract....oh and they charge a $20 "assignment fee" if you get assigned (+another $6.95 trade commission) Screw that!

        IB scales their pricing so options contracts on smaller issues (like your F shares) are less per contract. I've never paid more than $1.09 all in on an option trade...plus no added cost for assignment.

        They do have a minimum charge of $10/month if you're inactive. Considering how quickly they add up in other brokerages, it doesn't take too much activity to make that worthwhile.

        Delete
      4. Platform is pretty good. It takes a while to get used to, but very customizable for whatever you want to do. Watch lists with whatever climbs you want like ex dividend date, dividend and EPS (quick calc latest payout ratio).

        I didn't love it at first, but got used to it. And now I really like it.

        You can try out a paper trading account before moving real $$$. Like a test drive.

        Delete
      5. Thanks a lot for sharing your experience with IB, catfishwizard! I'm sure other readers will appreciate it...

        Delete
    6. Glad you're spending some time with the wifey Ferdis. Happy for your trip. All the hustling and you're enjoying life! Keep it up bro!

      ReplyDelete
      Replies
      1. Got to do it! Just grinding away at work and blogging when I'm home won't cut it... What's cool is that the portfolio just churned along nicely while my eyes were turned away!

        Take care DH!

        Delete
    7. Great progress, FerdiS.
      Keep up the great work...reading your interview with IH was a great way to get to know you better. Keep putting out those amazing Pixar movies :)

      R2R

      ReplyDelete
      Replies
      1. Hi R2R -- thanks for stopping by! I read your interview and enjoyed it a lot. IH has a great concept with the interview series. I hope he keeps it up.

        Thanks for your kind word about our movies. I've been at Pixar since 2002. A lot has changed, but one thing remains constant... we want to continue to tell great stories through the medium of animated films.

        Delete

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