Goal

This is a demonstration portfolio. Its goal is to achieve 10% Yield on Cost within 10 years of the portfolio’s inception in 2008.

The goal will be accomplished by:

(1) investing in excellent, low-risk companies with growing
dividends;
(2) reinvesting the dividends; and
(3) managing the portfolio according to its business plan.

Date of this report:

The information here was updated on March 1, 2015.

Fast facts:

  • Dividends  received in 2014 were 15% more than in 2013. I expect similar growth in 2015.
  • The DGP generates about twice as much cash as a similar investment in the S&P 500.
  • The DGP’s dividends have been growing at 14% per year since 2009.
  • The DGP is on track to hit its target of 10% yield on cost in 2018.


Table of dividends received:

To the right is a table of the dividends produced each year by the Dividend Growth Portfolio.

Years 2008-2014 show the actual dollars received. The amounts for 2015 and Next 12 Months are projections.

The projections will increase as (1) companies announce dividend increases, and (2) more shares are added through dividend reinvestments.

Dividend reinvestments in 2015:

I reinvest dividends when accumulated dividends reach $1000 cash. There were no reinvestments in February.

In January, I purchased more shares of AT&T (T) to add to an existing position. See these two articles to learn more:

  • I Just Bought Another 30 Shares of this Stock
  • Dividend Growth Stock of the Month for January, 2015: AT&T

Progress to 10% Yield on Cost in 10 Years:

I calculate the annual cash run-rate of the Dividend Growth Portfolio as of June 1 each year.

The chart to the right shows in blue the actual run-rate on the June 1 anniversary date each year. The number for 2015 is my projection for June 1 of this year.

The graph shows in red the goal line as it rises to its final goal of 10% yield on cost (or $4678) on June 1, 2018.

The blue Run-Rate line is hugging the red Goal line. This tells me that I am on track to meet the portfolio’s goal on June 1, 2018.

Positions as of March 1, 2015:

The DGP has 19 positions, shown in the table at the right.

Portfolio reviews and reports:

I conduct two formal Portfolio Reviews per year, most recently in October. Here are articles about the two most recent reviews:

I also wrote up the portfolio in this article in January: My Dividend Growth Portfolio: 2014 Review and 2015 Preview

Portfolio changes in 2015:

There were no changes in February.

In January, to balance the portfolio, I trimmed the positions in JNJ and PEP. I used the proceeds to add to T, MSFT, and start a new position in Digital Realty Trust (DLR). That brought the number of
positions up to 19.

Here is an article describing the changes to the portfolio in January: Why I Sold Some Johnson & Johnson (JNJ) and Pepsi (PEP)

Total performance since inception:

Beyond income production and growth, a secondary metric of interest is total return.

The graph to the right displays the total returns of the DGP compared to SPY (an ETF that tracks the S&P 500) since inception. Both are shown with dividends reinvested.

As of February 28, 2015, the DGP has gained 77% in total returns compared to SPY’s 73%. The DGP’s total value is $82,631.

Had the same amount been invested in SPY, it would currently be worth $81,028, and it would be generating only about half the cash flow that the DGP generates.