Aug 2015 – Portfolio Review (+ 14.46%)

Dividends earned in August 2015 = $382.18 * (Total dividends YTD = $2,208.64)

* Total dividends were a combination of:

  • Dividend Fund $255 regular distribution + $5.10 interest
  • Seadrill Partners (SDLP) $74.12 dividend
  • Transocean Partners (RIGP) $47.96 dividend

YTD Performance
Dividend Project Investment Portfolio = + 14.46 %
S&P 500 Index = – 4.21 %

I use S&P 500’s closing values right from the source… Standard and Poor’s website.

Dealing With Difficult Times…

In my post discussing investing psychology, I mentioned at the worst of the recent market drop my portfolio was up only 8.75 %. At the end of August, I am up 14.46 %. The best month ending performance of my portfolio was July when I was up 20.7 %.

Extreme volatility… a day traders paradise… but a nerve racking time for long term investors watching their portfolios take huge swings. I have to admit it’s not easy holding throughout these times, but I learned a few things:

  1. Picking great companies makes all the difference. You need to make sure you have an investment thesis going into your investment, and stick to your decision over the long run. Why is this important? The S&P is still off from its highs, but 1 of my stocks (BWLD) is already setting new highs.
  2. Let the market volatility settle… we had huge drops and up days, don’t get caught in the middle of the chaos.
  3. Have cash to take advantage of opportunities… unfortunately I do not have this luxury at this time. It goes without saying you should always know what you would purchase if you got the price you want (have a stock wish list).
  4. If buying call options, long term expirations will save you in volatile times… if I was holding the same strike on my call options but a closer term expiration I would’ve probably been completely slaughtered in the recent market drop.
  5. You cannot fight the market, you have to adjust to what the market is doing.

The Rest of 2015…

The stocks I am invested in are supposed to perform the strongest in the 2nd half of the year, but there is no predicting what the market will do. If the floor doesn’t fall out from beneath the stock market, I am hoping my stocks can push higher with solid earnings announcements, even with the S&P 500 having a dismal year.

The recent market drop doesn’t change the fact that the underlying business of the companies I am invested in is still strong.

I am fairly confident I will outperform the S&P500 at the end of this year which is an accomplishment in itself, but since this is becoming more of a certainty, my next goal is to generate a high return of + 20 %. At the end of July this was looking like a done deal, but the market easily snapped me back to reality.

One thing I’ve learned this year is my strategy is working, and that’s all I can ask for. You don’t fix something if it’s not broken. I am sticking with my strategy through the year.