Thursday, August 21, 2014

Mutual Fund Sale: ABALX


I started the year wanting to transition from mutual funds to stocks and today I sold off my shares of ABALX.  I owned 589.16 shares and the sale price is $25.61. The proceeds are $15,088.34 and this will reduce my yearly divideneds by $229.34.  The S&P 500 is current sitting at 1991.

I probably won't sell any more mutual fund shares this year because the taxes from the Intel sale, this sale, and my dividends are starting to become scary. 

There are no immediate plans to reinvest the proceeds.  I certainly want to continue the diversification process going forward.  I will be looking for larger block purchases separate from my normal weekly purchases much like when I invested in KRFT and AFL after selling the INTC shares. 

BBL is high on my radar since its recent pullback and I would also like to buy JNJ and XOM.  I may just pull the trigger on all three even though the market continues to make new all-time highs. 

Again I don't believe in timing the markets because it doesn't seem to pay to wait.  I will continue dollar cost averaging throughout all market cycles until I reach enough passive income to exit the rat race.
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6 comments:

  1. Roadmap2RetireAugust 21, 2014 at 1:23 PM

    Even though you arent trying to time the market - its a great time to sell. Right at the all-time market highs!

    Looking forward to see what you will buy. I am very intrigued by BBL - I had it on my watchlist, but the recent pullback has piqued my interest more. Need to do some more research and wait for my cash positions to build up a bit before i buy anything.

    Best wishes
    R2R

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    1. My Dividend PipelineAugust 21, 2014 at 1:47 PM

      R2R,

      Haha, I guess by selling off shares I am market timing! Not really as I plan on jumping back in very soon. I really just want to simplify the portfolio while elimating those nasty fees. I agree with you that BBL looks interesting here. I would love to see it drop back into low 60s, but wouldn't hesitate to buy at current levels.

      MDP

      Delete
  2. TawcanAugust 21, 2014 at 4:17 PM

    BBL is interesting especially with the recent pullback. I just purchased more JNJ shares recently.

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    Replies
    1. My Dividend PipelineAugust 21, 2014 at 7:26 PM

      Tawcan,

      I have been patiently waiting for a pullback in BBL and I think this is it. JNJ is difficult to buy because it never seems cheap. I will probably just hold my nose and start buying.

      MDP

      Delete
  3. adminAugust 21, 2014 at 8:39 PM

    Hey MDP,

    What is the tax rate that they charge you? I am asking you because I am a foreign investor and they charge me 30% on dividends, I wonder if they will charge me the same when I sell any stocks?

    Thanks,

    Emir-

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    Replies
    1. My Dividend PipelineAugust 22, 2014 at 9:15 AM

      Emir,

      The U.S. tax code is complex to say the least so it depends. There are different types of dividends (qualified and unqualified). Qualified are taxed at a lower rate. Also we have many tax brackets in the states which means until the end of the calendar year, it is difficult to tell what taxes will have to be paid. Also if you hold a stock for less than one year it is taxed as ordinary income which potentially means a higher tax rate.

      I probably didn't clear much up for you, but generally dividends receive more favorable tax treatment than income received from a job.

      MDP

      Delete

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