Tuesday, November 8, 2011

down, up, down, up

I'm guilty of doing exactly what the dividend growth investor shouldn't; watching my account values go up and down. If I had the correct view, I wouldn't do that, but Fidelity doesn't give me the option of watching projected dividend earnings, so I'm stuck with account values, positions and the like.
however, after several swings in the volatile market, I've convinced myself that I am not making emotional trades. Now I'm using the FASTgraphs site to look at fair value and stock price in relation to that, also looking at dividend growth in the past, and projections in the future, to guage whether my new purchases meet the margin-of-safety test.
Also, I've taken a big step and now am only working 3 weeks out of 4, using a week to clear my head and look to the future. Not clear yet what I'm seeing, but it's something other than what I've been doing for the last couple of decades.
I think I'm on the right track with the retirement portfolio. More and more of my holdings meet the criteria of undervalued or at fair value by reasonable estimates, have outsized dividends, reasonable payout ratios for their sector, and a history of revenue AND dividend growth. At the very least, I'm a reasonalbe disciple of the gospel of DG investing. In my few dabblings into growth, I've sucked a big egg on renewable energy and some other things; fortunately just a tiny piece of my portfolio, but the big losses and volatile swings make me remember why I abandoned that approach previously.
It's pretty clear that all the reading has paid off in a more focused set of voices to whom I listen and a more purpose-designed portfolio; just not certain yet that it's going to accelerate in the manner I hope. This is a long term strategy, so acceleration won't be at high-G force; rather a subtle building of momentum over time, but hopefully we'll be rocketing along down the line.
One can hope that the companies I have bought will continue their cost control discipline and continue to grow revenues in this tough world economy. If they do, and continue to distribute some of that as dividends, I'll fulfill my goal.
I think I may have between 4 and 9 years left of earning a wage; then I want to take my skills and use them elsewhere in the world without concern for earnings. I can't see the exact path to independence of the paycheck, but I can see the destination fairly clearly. It means changing my overall nest-egg expectation a bit, but then I don't expect to to be laid to rest on a bed of dollars.

more on that later...I'm working on unwinding some real-estate entanglements so I won't need the same paycheck to keep things afloat.

I'm going to read back a bit and see if I'm really any wiser or not.

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