2 modest moves, 1 giant leap

We're enhancing the portfolio reporting to help subscribers visualize the whole picture

• 2 adjustments to stock positions in the YARP portion of the portfolio today. Paid subscribers can check the research deck as usual to see the one stock I moved from 5% down to 3%, and the other I lifted from 2% to 4%. In the former case, It went ex-dividend recently and I while I like the chart, I don’t love it, and that translates to a more average position in the portfolio.

• With 40 stocks, and my trying to fill as much of that portfolio with those 40 stocks when possible, I consider a 3% position to be a stock where my short-to-intermediate-term outlook is “good.” But for those I see a better current combination of upside in price and and approaching ex-dividend date, I will opt to hold 4% or 5%. In the case of the one I upped from 2% to 4% today, it is a case of my liking it a lot, but wanting to save that last 1% raise from 4% to 5%. Because as I’ve said, I’m a chicken $!*#& investor! And that ex date is coming up but not imminent.

Now, here’s that “giant leap”

As I’ve been reporting to you, we are looking for a top-notch, sophisticated yet simple way to track my own portfolio, particularly the stock exposure and dividends earned and paid in the account. We are making progress, as you’ll see below.

The toughest thing I’ve found is that most such dividend-tracking systems are the same in that they assume that the number of shares and percent of portfolio held in each stock today is the same as it was, say a month ago, and same as it will be a month from now. So, it doesn’t provide an accurate projection for, say, when I owned a stock at 5% of the portfolio, earned the dividend, then sold it down to 2%. If I run a dividend report today, it forgets I qualified for the dividend with 5% of the portfolio.

I’m continuing to search for something better than adding a tab to the shared research deck to tackle that issue. For now, here is a glance at the current 40-stock YARP portfolio from a sector standpoint, through Friday’s positions. No surprise it is “under weighted” in tech and “over weighted” in REITs, Utilities and Materials.

That said, part of the uniqueness of my form of dividend investing is the option “overlay” that includes a call option on a major market index. That allows me to use a small amount of capital to get exposure to the parts of the stock market that a yield-focused portfolio won’t be able to own enough of to earn much in big S&P 500 and Nasdaq 100 rallies.

We’re hard at work finding a short list of preferred portfolio analytics tools, and we welcome all suggestions. In the meantime, I’m enjoying seeing the dividends roll in, and controlling the stock price volatility through my tactical position changes in the individual stocks. And, hoping that our new service is helping subscribers learn from what I do, and apply to their own situation and investment approach.

Best regards,

Rob