Lanny’s 2015 Portfolio Review

I  keep a copy in PDF of my portfolio every quarter, and have a deeper dive at 12/31, but this also provides a blog’d example of where I stand, so I can always refer back on the site the historical position of my portfolio.  As we have done in the prior year, this post will be a review and re-cap overall of my portfolio, the contributions, dividend going forward, dividend received, what I can analyze from the current position, etc..  It’s always fun to see what the year compiled into one snapshot of all of the hard work that goes into it.  I am excited to see where it stands and what can be done going into this new year!  Let’s dive on in. 

Last year’s post on the portfolio review, I was talking about the market being at all time highs.  As we’ll find out below, that definitely wasn’t the case for 2015, and was actually, in my mind, drastically different than 2014 – isn’t that what makes this even more fun?  I’ll provide the brief snapshot of 10 attributes on my portfolio, as you’ll see below, and then do an even more analysis surrounding my thoughts of how that came to be and what will 2016 bring from an actual action stand point.  Overall, you can see, 2015 was a very interesting and productive year, no doubt.  Definitely a very volatile year in the market, which means brief windows of opportunity for investments.  Here comes the 2015 review of my portfolio:

Portfolio Review

  1. Contributions (Including Retirement, dividends reinvested) YTD 2015: $37,242.72 (Average of $3,103.56 per month)
  2. Portfolio Market Value as of 12/31/15: $164,324.31 (Up $31,149.67 or 23.40%)
  3. Portfolio Estimated Income for 2016 as of 12/31/15: $6,504.97 (Up $1,442.40 or 28.50%)
  4. Portfolio Yield (Overall): 3.96% (Up 22 basis points from 12/31/14)
  5. Portfolio Yield Individual Account: 4.04% (Up 19 basis points from 12/31/14)
  6. Portfolio Yield Retirement Accounts: 3.82% (Up 26 basis points from 12/31/14)
  7. Portfolio Yield on Cost (Overall): 4.86% (Down 15 basis points from 12/31/14)
  8. Positions in my Individual Account: 36 (Up 6 net new positions)
  9. Positions, including 2 mutual Funds and 1 ETF, in Retirement Account: 10 (Up 3 new positions)
  10. Total Dividend/Distributions Received in 2015: $6,134.66 (Up $2,122.74 or 53%)

What does all this information mean – one may be asking?  Well, I figured I can start from the top and work my way down.  My total contributions, when compared to the 2014 year was slightly lower by $8.4K, which is mostly attributed to starting the 2014 with much, much more cash than I did for 2015.  I still, on average with the power of dividend reinvestment, managed to invest approximately $3,100 each and every month throughout 2015.  I would say that’s a fairly nice feat, which can also be correlated to much more dividend income received in 2015 vs. 2014, including me finally crossing the $1K mark in December or the last month of the year.

Ah, then you have market value.  The market value of my portfolio compared to the year end last year is up $31,150 essentially, but you can see that $37.2K went into it, as described above.  From my other factors that go into it, i.e. stripping out and breaking down 401K matches, etc.. I believe I came out to a -1.95% YTD performance.  See below, the S&P’s YTD performance of -2.15%.  Therefore – nothing too different from the overall market as a whole:

S&P YTD

There are multiple benefits of a dividend investor when the market isn’t performing well, as I described in a previous article.  Obviously there were bigger dips in the August through September months, with the rebound effect occurring over the last 3 months of the year.  Luckily, this is the time period that Bert and I were purchasing two solid dividend aristocrats in Johnson & Johnson (JNJ) and Emerson (EMR).  When I look at 12/31/15 performance on those two stocks alone – I was up 6.89% on JNJ and 3.42% on EMR – in just a few short months.  Fortunate to grab these foundation stocks and always buy stocks at a discount during that time period.  Which those positions are more in line with my new defined focus after KMI’s news of cutting their dividend by 75%+ into 2016.

As we move down the list, you can see that I didn’t quite hit my 2015 Goal of $6,750 in projected income.  I did get an adjustment from KMI of a downward $210 amount, which obviously had a very big impact to achieving the goal.  Lessons learned, that’s for sure.  I did increase my dividend income going forward by $1,442 on an annual basis or a whopping $120 extra per month.  Very excited I was able to do that, and I think seeing those results and a higher projected income going forward, allowed me establish my 12/31/16 goal to have a projected income of a flat $8,000, which is $1,495 away from 12/31/15.  Given my breakdown at that linked article, I feel with more income this year, higher 401k matching contributions due to my salary and age going up, that this will be attainable.  Hey, if I get lucky and crush that goal in the late 3rd or early 4th quarter – that is absolutely fine by me.  I think 2015 really showed/stretched me to my capacity for the year, because if you take out my dividends reinvested, and matching 401k contributions in 2015, I contributed about $29K of my own saved cash into the market, or $2.4K per month.  There were other bonuses from work that allowed me to do so, however, I do not project that those one-time events will occur, as I don’t feel you should guarantee bonuses are always there.  I increased my dividend projection via dividend growth and consistent contributions to the stock market.  One can even say that my income went from approximately $422/month to $542 per month, and then by the end of this year, the plan is to see even further growth to $667 per month (gosh thinking that if I do crush the goal and have a smooth $700/month going into 2017…would be fun to see).  I learned that you shouldn’t invest into yield alone, which we all knew that, but even the largest companies in an industry can battle economic headwinds, as we’ve seen with KMI.

My yields overall have increased, but this is an easy sign that the market alone has just dropped.  Therefore, if you have a declining market but have companies that are increasing their dividend = yield will be higher, especially with those 2 factors playing to the yield game.  I love it when my dividends are being reinvested into fundamentally sound companies at a lower stock price — all good with me : )   To note, though, my Yield on Cost, decreased, which is attributable to my investments into EMR, JNJ, and ADM – all with significantly lower yields than my weighted average of around 4%.  Hence the YOC decreases.

Bringing me over to the new positions for the year.  A similar statement, the most significant new investments I have in my portfolio come from Emerson (hell, bought them 3 times in a fairly tight time frame), Johnson & Johnson (JNJ), Archer Daniels (ADM) and even Norfolk Southern (NSC).  These were just a few of the names added to my list.  Additionally, I sold out of Lorillard to capture more capital to contribute to Phillip Morris (PM), even though with currency conversion fluctuations, that they became a big company increasing their dividend by a low percentage amount.  All in all – I am happy with my positions here and I do not foresee new companies that I am dying to add to my portfolio, outside of having significant thoughts on investing into Starbucks (SBUX) in 2016.

Probably the most befuddling or interesting mark above is my actual income received this year.  I was projected to go into the year at $5,062.  I ended up collecting over $6,100 or more than $1,000 more than expected… interesting, eh?  This could be due to significant purchases made in the first half of the year, that I was able to collect and benefit in the second half, Caterpillar (CAT), Johnson & Johnson (JNJ) and DOW Chemical (DOW) come to mind.  Either which way, I’ll take the reinvestment, but definitely earned more than what I was expecting.  One could then even argue that I’ll actually end up receiving over $7,000 in 2016, but time will be a reflection of that this year, as well as contributions.  Interesting, eh?

2015 Portfolio Conclusion & Summary

How do I conclude in my portfolio of 2015?  All in all – it was a down market year, but that didn’t turn me away from investing, one bit.  I know when establishing those 2016 goals had a lot of the review of my portfolio above and I am excited to see the new challenges ahead.  Further, the unknown is always exciting – the market in the last week of the year had half green and half red days – it’s incredible.  I feel that volatility will be high this year as well, with significant dips along the way – we all need to have that capital ready to fire away!  Further, I feel as though commodities with oil still, food and other crop-like products will be volatile as well, but who knows, that is just my gut stating that.  Either which way, I’m pumped to place my portfolio in the best position possible, using the dividend diplomat stock screener to review companies for investment, keep a keen eye on the aristocrats that are a foundation staple in a portfolio, or that even have low debt-to-equity metrics as Bert has described.  Excited to build on positions where I can and bolster the walls of the portfolio.

With all this being said – what do you see in my portfolio?  How did you do?  What actions will you take into 2016 going forward?  Looking forward to hearing from everyone and thank you again for coming by!  Hope everyone had a great new years weekend and are ready for the horizon of the upcoming year.  Good luck and talk soon!

-Lanny

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9 thoughts on “Lanny’s 2015 Portfolio Review

  1. Great overview, very thorough!
    Cool to see how your cost basis yield (despite its reduction) and current yield differ significantly. This gap should continue to grow over the years, you should see this go to double digit returns during your years after reaching financial independence. Would that not be awesome!
    A whopping amount of contributions by the way, that is some serious cash! If you can keep that going, you should be “done” in no-time 😉

    • CF,

      Thank you very much – the gap is funny, but also that it went down is very odd, but it’s due to lower yielding investments and not owning them long enough. I’m excited for the spread to really start this year.

      Thank you very much again on the contributions! It’s all about serious savings, right? Every dollar matters in my book and am continuing to do the same in 2016! Cheers to the new year!

      -Lanny

  2. Fantastic progress Lanny. It’s very impressive that you’re so far along after only 2 years of investing. The fact that you invest $3k in fresh capital each month also speaks to your focus. Bravo! I hope you guys both have a great 2016!
    -Bryan

    • Income Surfer,

      How is it all going? Luckily – had some good fortune in 2015, good reinvestment, a decent match from the employer, etc.. It all brings a benefit! very lucky and fortunate, that’s all I can say Bryan. Talk soon my man, pumped for YOUR year.

      -Lanny

  3. Nice job Lanny. You’re doing great. There is no way that you won’t achieve your goals with this rate.

    I’m quite jealous really 🙂 Like you said, although your yield has slightly decreased, in the long run that will just keep growing and growing, depending how much you invest each year. Well done!
    Tristan

    • Tristan,

      Thank you very much. I hope I can hit the goals early and often, right?

      Jealous? Oh don’t be! All it takes is time, commitment, discipline and desire. You have it too – YOU CAN DO IT! Here is to day 5 in the books, 361 to go !!!

      -Lanny

    • Tawcan,

      Thanks – solid, but should be higher! Hoping 2016 shows some nice dividend growth rates – how about this market though? Talk about blood bath out there… it’s interesting! Thanks for coming by, as always Tawcan, talk soon.

      -Lanny

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