How I BUY STOCKS (Dividend Investing Style)

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I often receive the question here about how I go about buying net new positions in my dividend stock portfolio. Technically speaking, how do I approach a new position? Do I like to just go for it and buy the full position, or do I average in over time? Actually, I like to do a bit of both!

Today’s video starts out with a discussion of non-meaningful vs. meaningful stock positions. I cannot stand micro, ancillary positions, ones that don’t really pull their own weight in my overall portfolio. I actually view my stock portfolio as a work of art (I’m serious). I only like positions that are at least 1% of my total dividend stock portfolio (and certainly above 0.5%). If a stock is smaller, I either get rid of it, or I do everything in my power to get it to the appropriate size, fast!

My stock buying strategy is a unique one. Historically, I have been “all in”. I like my money to work for me, earning dividends, while I sleep. As such, I have not been a fan of cash. I like to have my money working for me. So, when it’s time to purchase a new stock, I often don’t have a lump sum large enough to bring it to the appropriate size (1% or more of my portfolio). As such, I typically make a smaller lump sum “starter investing”, and then I average in each and every month until it reaches the appropriate minimum size (a meaningful size).

Since my buy process takes some time (lump sum plus months of averaging in), I like to start when a stock is on sale. I like to buy values! In my early days, this was not always the case, as I was acquiring core positions that I just had to have. These days, I typically only buy into big value.

At the end of the day, I view my portfolio like my house. I keep a tidy home, and I also keep a tidy portfolio. Small, insignificant positions don’t have a place. It’s all about focus for me.

Want to learn more about my position in Southern Company? Check out this recent video:
https://www.youtube.com/watch?v=SW_jAVvhEqw

Want to learn more about my position in Dr Pepper Snapple? Check out this recent video:
https://www.youtube.com/watch?v=fcn8BlqYwUo

Want to connect in Instagram? You can find me here:
https://www.instagram.com/ianlopuch/

Disclosure: I am long Dr Pepper Snapple (DPS) and Southern Company (SO). I own these stocks in my portfolio.

Disclaimer: I’m not a licensed investment advisor, and today’s video is just for entertainment and fun. This video is NOT investment advice. Please talk to your licensed investment advisor before making any financial decisions.

All content on my YouTube channel is (c) Copyright IJL Productions LLC.

15 COMMENTS

  1. Hi Ian! Would you recommend starting with dividend investing instead of growth investing? Why not begin with growth, while young and can afford some risk, to get some value together and switch to dividends before retirement? Growth over growth is also a form of compounding?

  2. I hold dividend stocks but I also write covered call to collect premium around 1-2% return a month. So this help with ROE but I do have to pay a bit of fee which I don't mind.

  3. Another great video Ian great content. Cull smaller positions in portfolio is good active management! I like the term meaningful positions. What percentage of your portfolio are the larger positions? Do you have a percentage range for larger and medium positions?

  4. Hey Ian, good video. What %s should cores me at? and medium? and small/ancillary positions? I'm curious of what % proportions you feel belong to each type of position

  5. your videos are refreshing,, you seem to have a strong disciple about this,,, I totally understand that you want safe investments and it seems like you leave no room for a stock who are today is in financial trouble,, ie todays example GE,, for me if GE GOES UNDER 10 SAY 8-9 ,, I would warrant some money(actually I am putting money aside for this event right now) that if GE HITS 8-9 I will purchase,,,, again I love your style and ideas,,,

  6. If you were starting out from scratch, what stock would you look into buying today that pays dividends? Great videos by the way!

  7. Thanks @ppcian your videos are very helpful as usual and "entertaining" lol.
    Unfortunately i dont use Instagram but I just followed you on twitter last night. Cant wait for your insight on stock splits and the pros and cons about them. Question, when you were actively looking for a new company(S) to add a position to how much time do you typically spend on doing so before your brain gets over heated? Do you have a specific time allotted per day or week? Thanks again in advance

  8. Another great video Ian! Do you have any tips for someone who is starting out as a dividend investor, on how they can avoid the temptation of over extending themselves in their stock purchases? I, and I am sure many who are in the beginning stages of their investing career, run into this where I tend to buy too many stocks, while risk dwindling my cash/savings, because the stocks are so cheap. Especially with the mini corrections we have been having these past few days, I have an even greater temptation to buy, in case the stock prices rise again and I miss out on a deal. I am trying to find a balance between investing while maintaining a healthy cash/emergency fund on the side.

    Cheers,
    TK.

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