In the past 11 months I've bought 9 high quality stocks.
During my first year as a Dividend Growth Investor, I tried to focus on dividend yield. As this yield generates money to buy more stocks. However, I'm here for the long run. This means growth is a huge factor in growing the snowball.
That's why I created the table below to evaluate the balance between yield and growth.
It is available at the second tab of my portfolio page.
As you can see, most of my high yield (3%+) stocks, don't have extraordinary growth numbers. It would be amazing if I could average the growth numbers to double digits, while maintaining the 3% yield as well.
While I don't think aiming for double digit growth should be a goal itself, I do think it would be a good idea to focus on growth during my second year of investing.
To prove there are great companies out there with double digit growth numbers, I've extended my watchlist. It now features both yield and 3-yr DGR numbers. In addition to this, I've marked some great companies like DOV, MMM, TROW, HP and ADM in bold. This means these companies have double digit growth numbers in the DGR-5, DGR-3 and DGR-1 categories.
Have a great weekend!
A mix of low yield high growth and high yield low growth dividend stocks is a great idea. You never want to put eggs in one basket.
ReplyDeleteHi Tawcan,
DeleteThanks for taking the time to comment!
Good to hear we are on the same page here.
Best wishes, DfS
I think the move into concentrating on growth while still having a decent yield is smart. If course I'll say so because that's what I'm doing! :-P But it looks more profitable to me for long-term investors as it means more returns.
ReplyDeleteCheers,
Mike
Hey Mike,
DeleteThanks for your comment!
I agree. It seems like less 'fun' because it takes longer to see results, but the results are better.. so it should be worth the effort!
Best wishes, DfS
You have nice portfolio! I am trying to have a mix of "safe" slow growing stocks and fast growing stocks.
ReplyDeleteHi HHWG,
DeleteThanks for your visit! Appreciate it.
That's right. My portfolio consists of very safe investments. That's what I call the foundation of my DGI portfolio. Once I have a position in all the quite obvious companies, I'm sure to mix it up a bit!
Best wishes, DfS
I like your portfolio holdings. It's solid all around and provides above average yield. Many people starting out in the DGI game go for those high single digit or double digit yields in the mREITs or some MLP only to get burned with dividend cuts or eliminations. You have filled your portfolio with solid names. Thanks for sharing and keep that yield on cost growing.
ReplyDeleteHey DivHut,
DeleteThanks for your comment!
You're right and I feel good about it being solid. However, it does not mean I didn't make any mistakes. I think everybody prefers to get rich fast rather than slow. That's why I tried risky stocks, forex, peer to peer lending with >30% interest and I even own some Bitcoin. This all happened between my 20th and 30th birthday.
On the bright side.. I'm glad I've seen the light with a relatively long horizon left. It's 35 more years until retirement, that should definiately be enough to start retirement early. Not at 40 years old, probably not even at 50, but every single year helps.
Best wishes, DfS
I would buy the S&P. A lot less work, and almost a 2% dividend. At Fidelity, IVV is commission free.
ReplyDeleteWith individual stocks, sooner or later you will have tax consequences, or commission expenses that sap your returns.
Hi No Nonsense Landlord,
DeleteThanks for your visit and your comment!
I'm in Europe. Things are a little bit different here.
We do not pay commission on buying individual stocks. :)
Apart from that I'm trying to get a little bit more than 2%, because that much won't allow me to retire early with my fulltime job.
The S&P seems to be the safer choice, but there are number of articles which prove the Dividends Aristocrats have outperformed the S&P 500 for over 15 years now.
Thanks for your thoughts though. I might regret not following your advice in 10 or 20 years..
Best wishes, DfS
Hi there DFS,
ReplyDeleteA fellow European dividend hunter here! I have started about 6 months ago to invest and you have been on my list of reads for some time. Keep up the good work!
Hey Stalflare,
DeleteThanks for you visit and your comment!
That's very kind of you. Your blog looks promising! I'm looking forward to see more content out there in the near future and I'll be sure to check it out.
Best wishes,
DfS