Well another month has flown by and the dividends have rolled in once again, kinda nice right? I have to confess i am intrigued about the impact to the income once the interest rates start to normalize. I’m still looking for this to occur sometime in 2015 although earlier would be a surprise and there in lies the crux, surprises are normally when you make or lose the most $$. The question for me will be the price of my stocks vs the dividends coming in. Is it worth holding on while things normalize? With the vix this low, probably worth buying some SPY LEAP puts just in case.
Everything is in ‘goldilocks’ mode right now but i think i’m becoming more prudent as the market charges up to 2k. My expectation is still for some kind of big correction to come (10-20%), maybe a flutter around 2000 or near it then i’m looking for some major down days to come but it could happen on the 1st interest hike or when tapering is completely done. This is of course is pure conjecture, just like anyone making a prediction on tv or wherever but i’m looking for a a good news = market goes down type scenario in the second half or 1H 2015…..we’ll see. The 10yr keeps rolling lower which is something to watch…why is everyone piling in there still? I guess we’ll find out in due course.
Anyway, i’m off course with regards to this post. The dividends came in this month a pleasant $905. The impact of buying stocks earlier this year is starting to play ball. I have more funds to put in July then i’m kinda on hold until next year. I’ve been putting money into more beaten up stocks or ones that have potential to become good dividend earners when the mist clears ( LYG being one example ). I am not a fan of buying stocks when everyone is beating their chest about them, just the contrarian in me so i’ll wait for some kind of correction before piling into the classics like GE, JNJ and so on.
I’ve also been accumulating some new positions which should hold me in good stead. I’ve recently purchased some Brookfield stocks ( BEP and BIP in particular )…i’m liking these for the long haul ( 10yr plus holds ), 5%+ dividend and very diversified business globally under the hood, should be a decent buy.
I’ve been riding the call options well for a while, did great with AAPL and got out at $620 from about $500 entry, feel a little irked as it ran another $25 in 3 days when i exited but i just stuck to the plan. Impossible to call a short-term top 🙂 Interesting to see what happens to the stock for WWDC and the split shortly after. I’m expecting sideways chop for a while then another push to the $670-$700 range with the iPhone 6 catalyst so i may re-enter on any dips but if it runs straight-line to $700, that’s just the way it goes. Can’t win ’em all.
Anyway, next month should be interesting for dividends, on top of the usual suspects, i get a hefty payment from Veolia ( VE ) as it is just an annual dividend and sadly taxed at a ridiculous 25% – thanks France 🙂 but i love the company for the long-term especially with all the concerns about floods, sewage, desalination and so on. These are boring stocks but they will do well in the long-term is my belief. The stock is still hated and they are still crawling out of a large debt position, i think another year or two should be a good tell but in the meantime, i’m getting paid to wait.
Hope everyone is doing well, summer is a boring time for investing but perfect for dividends. I’m not looking for any great moves in the tape until August/September/October. If you look back historically, that is often when the market does something big. Pick up a copy of the Stock Trader’s almanac, it has a ton of useful information in it for seasonality.
I’ll try and get a post on the technicals up sometime next week, just been snowed under with a ton of work for the last 3 weeks.
All the best