Once again it is time for a goals/progress update. I am pleased to report that annualized dividend income rose in June, extending the streak to 4 months after February’s decline. Since I began publicly tracking annualized dividend income in November 2007, it has increased in 18 of the last 19 months.
|Div. Changes YTD||(371)||-0.32%|
The above information covers the current month and year-to-date through the current month.
For the month, annualized dividend income increased $114, and Yield on Cost (YOC) increased 0.01%. These changes were a net of new purchases, dividend changes and sales. Let’s examine each of the these categories:
Purchases: The $224 increase in annual dividend income and (0.10%) decrease in YOC related to the following purchases (yield at the time of purchase):
- $59 Johnson & Johnson (JNJ) 3.50%
- $72 Pepsico, Inc. (PEP) 3.39%
- $93 iShares Investment Grade Corp. Bond (LQD) 5.77%
All the purchases, except LQD, lowered my YOC. As noted in earlier updates, I generally expect YOC to drop each month since most new investments will yield less than my current YOC, and dividend increases will not be sufficient to offset it.
Dividend Changes: The $44 decrease in annual dividend income and (0.03%) decrease in YOC related to the following dividend changes (a=dividend stated in annual terms, q=quarterly, m=monthly):
- $3 Johnson & Johnson (JNJ) $0.46q>$0.49q 0.00%
- $3 Pepsico, Inc. (PEP) $0.425q>$0.45q 0.01%
- ($18) Eaton Vance Tax-Advantaged Global Dividend Opportunities Fund (ETO) $1.84m>$1.78m -0.01%
- ($4) Vanguard Dividend Appreciation ETF (VIG) $1.08a>$1.03a 0.00%
- ($20) Vanguard REIT Index ETF (VNQ) $2.98a>$2.67a -0.02%
- ($8) Vanguard High Dividend Yield Indx ETF (VYM) $1.38a>$1.29a -0.01%
Sales: The ($66) decrease in annual dividend income and 0.08% increase in YOC related to the following sale:
- ($66) Vanguard Financials ETF (VFH) 0.08%
Looking at the Dividend Changes section above, it is easy to see why holding ETFs/CEFs in my income portfolio does not align with the portfolio’s goal of consistently growing income – 2 individual stocks increased dividends, while 4 ETFs decreased. In June I continued the process of trimming back my ETFs/CEFs income holdings with the sale of VFH. I will continue to reduce my holdings in this area each month.
Based on year-to-date results, I believe my revised estimate of $6,300 of annualized dividend income on December 31, 2009 is still obtainable.
That’s it for this time. The next monthly progress update will be on Saturday, August 8th.
(Photo: sanja gjenero)