 |
| Sometimes it takes a WOLF to see if you have built a strong house. |
It will be interesting to see how some of the energy companies out there hold up to extreme pressure. I feel like the three I purchased today have brick-like characteristics. We shall see.
- BBL: 6.15 shares @ $40.66 --- Yield 6.10%
- RDS-B: 3.84 shares @ $65.10 --- Yield 5.78%
- CVX: 2.32 shares @ $107.78 --- Yield 3.97%
Total capital invested is $750 ($250 in each company). The combined yield on these purchases is 5.28% and will add $39.62 to my yearly dividends.
Falling oil prices continue to be story as it has been for the past several months. If there is ever a time to focus on my energy position it is now. I have no idea if a bottom is forming, but I will continue to average down my energy positions. Exxon continues to be the most resilient of the group and I would love to buy more shares, but I will be patient.
As I look at my portfolio, it is amazing to see how relentless and ferocious the storm has been. Many of my energy and oil positions are hovering at 25-35% unrealized losses. To many people it may seem a bit silly to receive a 4-5% dividend when it realistically could take many years to get back to even. That is not what long term investing is about and many people are running for the hills with a lot of blood trailing behind them. I will stay the course even though it is a bit scary right now.
What helps me sleep at night and continue forging ahead building my energy positions is the knowledge this is a long term process and I will not get overly frustrated during downturns or overly exuberant during massive upswings.
If suddenly P&G, Clorox, Pepsi, or JNJ were trading in the 50s, I would without any emotion or hesitation change course and start buying those companies. If only that would happen....:-)
I feel very confident that someday I will look back on these months and say to myself..."Why weren't you more aggressive during this period? Energy was a no brainer."
Stocks on my radar for next week are UL, TD, RDS-b, CVX, T, VZ, PM, CAT, and CVX.
I agree with you, these companies aren't going anywhere any time soon. Long-term, you will be rewarded for taking advantage of dropping prices and lowering your cost basis on each. Keep on grinding!
ReplyDeleteW2R,
DeleteI plan on grinding away...at least for a few more years.
MDP
How does this Sharebuilder thing work? Do you just buy a certain amount of stocks (the ones you feel are best valued at the moment I guess?) every week for the diversification or whats the thought behind this?
ReplyDeleteAktiensovisen,
DeleteFFF explained how Sharebuilder works perfectly.
MDP
Great job MDP on unloading that ammo. Keep em firing!
ReplyDelete@Aktienovison: From my understanding he is set up for a weekly investing every tuesday, (lower commision cost) which he can edit the day before. This is a very good strategy to keep on course, he gets to avoid 'timing' the market by investing on a scheduled regularly and he can diversify easily picking multiple brand names in an attractive price. Thats how I see it...
Thank you! Thats sounds like a good strategy! I wish something like the Sharebuilder would exist here in Sweden. The closest thing to this is like a "Mini-account" where you can buy shares up to $50 for the commision cost of 12 cents. And after that its 0,25%. Maybe I can use that as my "Sharebuilder" :)
DeleteFFF,
DeleteI will keep firing away, but I need to make sure to keep some powder dry!
MDP
Unfortunately that deal is only for stocks traded on the Stockholm Stock Exchange. How I wish the deal was for NYSE :-(
DeleteWhat are your thoughts on KMI?
ReplyDeleteI just noticed that you have about 10k worth of KMI stock. Are you done buying KMI? Do you think it's still worth buying?
ReplyDeleteJoel,
DeleteIt has been almost a year since I have added to KMI. It was trading in the low 30s at that time. I would rather wait for a pullback in the 30s before adding more shares. I don't know if that will happen, but with all the recent turmoil within the greater energy sector I think it will at some point.
MDP
Nice to see that you continue to add to your existing positions!
ReplyDeleteI agree that some point in the future we will all look and ask ourselves why we weren't more aggressive on energy stocks.
I think we should all say thank you to the individuals fleeing to the hills giving us the sales of late!
Mr. Captain Cash
Mr CC,
DeleteYes, buy when there is blood on the street. Some of it is mine, but I will keep at it.
MDP
Thanks for sharing your weekly purchases. I do love reading these updates. Have you considered BP for next week? It has also been slammed along with TOT in just the last week. Another non-energy play that I started eyeing and you mention is CAT. I remember how down my portfolio was during 2009. It can be unsettling but as you mention when you are in it for the long haul you can't be swayed by these gyrations.
ReplyDeleteDivHut,
DeleteI keep missing CAT when it gets into the 80s because I keep thinking it will get into the 70s. I may pull the trigger this time even if it is a bit early. I'm pretty heavy in BP so I will probably add to Shell, Chevron, and Exxon.
Thanks for stopping by!
MDP
Great buys. I will continue buying energy sector stocks to average down our cost as well.
ReplyDeleteTawcan,
DeleteI am with you and will keep adding to these names as well. I can't wait to switch sectors though, hopefully some other opportunities will come our way!
MDP
I'm continuing to add to by BHP, Chevron, and BP, thought not weekly. It does make me a bit nervous though considering the health of my job and property value is already tied closely to energy prices (as I live in Houston and work for an oil company).
ReplyDeleteWe need a different sector to go down the tubes for a bit.
Adam,
DeleteSince I live in Houston also, I understand your concerns. I think in general most Houstonians are fully aware of the boom/bust nature of our city even if it is much less impactful than 30 years ago. I would love for consumer staples and tobacco to to a bit hit, but it seems unlikely.
MDP
MDP,
ReplyDeleteGood work as always over here. It's nice to see you taking advantage of energy prices. I find it interesting watching which stocks move with the oil names, some real deals out there. Let's hope for some more turbulence in the market here. Hope all is well and wishing you continued success this year!
Ryan,
DeleteI must admit the ground does feel a bit shaky, buy I like the risk/reward prospect of investing in energy right now. We'll see how it goes from here.
MDP
Excellent purchases. I bought BBL and RDS-B last month. Ive been considering buying more oil stocks but I don't want oil to take up most of my portfolio. I agree that I'll probably look back and think "Why didnt you buy more when you had the chance?" so I keep second guessing what im gonna buy.
ReplyDeleteDFD,
DeleteGreat job buying those two companies. I completely understand your desire to stay diversified. Energy is tempting though.
MDP
MDP,
ReplyDeleteGreat purchases again! With the further pull-back in oil prices, it's getting more and more tempting to add to my RDS-B position too. We'll see what happens over the coming days.
Also, the day that PG or JNJ drop down to $50 I'll be throwing all my available cash at them.
Keep it up,
NMW
NMW,
DeleteThanks! I don't blame you for want to add to your Shell position. As far as PG and JNJ, I would love to add in the low 80s at this point. :-)
MDP
MDP,
ReplyDeleteIt's all good here! Averaging down yet again and great pick up of $40 in forward income. I made some moves with $1,775 in purchases spread over 3 companies I'll write about and picked up quite a bit in income as well off of it, roughly $64-$65 I believe.
I wish I had $50K in capital to add into the market yesterday, just glad I was able to make some sort of move.
More to come!
-Lanny
Lanny,
DeleteI be watching to see what you purchased. It looks like the whipsaw market action is continuing today. Up 200 points already.
MDP
Hi, MDP.
ReplyDeleteI'm digging the graphic. Thanks for sharing. Nice job taking advantage of the recent sale on energy. It is only a matter of time before the price of crude hits bottom and shoots back to normal levels. Take care.
Goosemann Jones
Flight to Dividends Blog
Gooseman,
DeleteThanks for the compliment. There certainly have been some wolves and bears wandering around lately. I agree with your take on oil prices. It is a good time to build up the energy component within your portfolio.
MDP