How I Know Which STOCKS To Buy (Dividend Growth Investing)

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I own 37 dividend stocks in my stock portfolio. On any given month, I’m almost always averaging in (buying more shares). How do I know which stock(s) to buy at a given time? How do I invest my hard earned capital in dividend stocks, while looking at things both logically and emotionally? Today’s video shares my very strategy.

Before even starting, it’s important to recognize whether one is looking at a net new portfolio or an established one. While most of today’s video covers the strategy of how I buy stocks for my established dividend portfolio, I also discuss how things would differ for a newer portfolio.

Next, I dive into my personal pillars for success.
Pillar 1: I enjoy setting strategic buy order themes each year. Each January I pick a few stocks that I’ll focus on accumulating any given year. This year, it’s Procter & Gamble and Kimberly Clark. My analysis is based on fundamentals. By setting the theme early in the year, I stay focused and determined.

Pillar 2: When I invest in a new position to my established stock portfolio, I go “all in”. Meaning: I will start with a small lump sum investment, and then I keep averaging in until my position reaches its desired size (and, at a minimum, my “full size” for a small position). I believe in good housekeeping and dislike 1-off positions in my portfolio.

Pillar 3: I’m always looking out for great investment opportunities. Since I own 37 stocks, several of them are always on sale at any given time. While I like to first focus on pillars 1 and 2, I will buy “on sale” stocks as well, when opportunities present themselves.

Pillar 4: Certain of my stocks fall into trading ranges, more or less. I like to place a small amount of capital in them, each time they hit the bottom of the trading range.

At the end of the day, this strategic framework keeps my investing vey logical and pragmatic. It keeps me focused on doing the right things, avoiding all the noise out there. It also, however, leaves some room for emotion which I think is actually important for dividend growth investors.

As mentioned in today’s video, I have quite a few related videos to share with all of you! Following is my long list of related investing videos that you may want to check out.

First, let’s jump into videos that discuss hypothetical scenarios of starting all over again. Following are the ways I would start, if I were hypothetically starting over with different amounts of money!

Investing My First $1,000:
https://www.youtube.com/watch?v=Iijz-5vGSh0

Investing My First $5,000:
https://www.youtube.com/watch?v=5Bp0TzQKRr0

Investing My First $10,000:
https://www.youtube.com/watch?v=4i_3KAY1ZMo

Investing My First $25,000:
https://www.youtube.com/watch?v=CGrf5He8ieU

Investing My First: $50,000:
https://www.youtube.com/watch?v=ishEcrSTK-c

Also mentioned in today’s video, here’s some info on my personal stock portfolio, on my small, medium, and large/core strategy. Learn about my personal asset allocation:
https://www.youtube.com/watch?v=3ybS8GQl_vA

Each year, I like to set strategic themes for my buy orders (pillar 1 of my strategy). This year, my strategic theme spans Procter & Gamble and Kimberly-Clark. Learn all about my dividend investing strategic themes for 2018:
https://www.youtube.com/watch?v=uGRmIeiep1g

While I don’t buy many net new stock positions these days, when I do I’m all in. (In the sense that I will keep buying and averaging in until the position reaches full size.) Here’s a stock I just started buying, General Mills (pillar 2 of my strategy):
https://www.youtube.com/watch?v=z12Ac83Nz0Q

While I mainly focus on pillars 1 and 2 of my buy order strategy, I just can’t pass up a good opportunity. I also like to make incremental buy orders of dividend portfolio stocks that are “on sale”. This year, I’m buying some Southern Corporation:
https://www.youtube.com/watch?v=SW_jAVvhEqw

And, Realty Income:
https://www.youtube.com/watch?v=P-ANUrAsqMc

Last, I want to share my recent analysis of Coca-Cola. While I own this stock in my portfolio (and it’s a core position), I won’t be buying more this year. It’s just not “on sale” right now, and it doesn’t fit my strategic pillars. That said, if I were hypothetically starting all over again with a net new portfolio, perhaps things would be different:
https://www.youtube.com/watch?v=Egb3PfTOtSs

Disclosure: I am long Procter & Gamble (PG), Kimberly-Clark (KMB), General Mills (GIS), Southern Company (SO), Realty Income (O), and Coca-Cola (KO). 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. Also, I’m not a tax advisor and today’s video is NOT tax 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.

14 COMMENTS

  1. Another great video, Ian! Thanks for all the work you put into these. I do have a question. How do you decide which stocks are core positions? That's one of the things I struggle with the most is just knowing what to focus on.

  2. If you do, do the ford video you should rate it on both sides of this video. How you have 37 stocks and how the analysis may fit with you personally as well as looking at what it would look like for a new portfolio. I think if you did that it would be more informative, would add some parity between the established and new investments. It’s up to you. Also you did at&t I think, what about the numbers on Verizon. It looks like a great opportunity at the moment. And 100% agree on what you mentioned with coke. As a newer investor I couldn’t help but add it even though the current situation doesnt exactly cause a lot of salivation over a great deal…but it’s coke…that’s what I mean with the parity between the two

  3. Great videos Ian. I like how you present your videos and like your analysis on stocks and investing principles. I always try to support by watching every ad on your videos

  4. Maybe do a trading stock range video.

    KO was my second dividend stock bought just because of what you said. I am still in the process of adding some different types of dividendstocks. Energy is up first, healthcare second, financial third, food is fourth and then fifth is brick and mortor.

    I also heard that Gamestop has 10% dividendyield. I know it's also a dying business but their dividend payout and cashflow is rather good. PE is around 5.

  5. Thank you for the dividend information. Has the payment schedule of a dividend paying stock – quarterly vs. monthly – ever play a role in your decision?

  6. Love hearing your strategies, Ian. It is almost exactly how I like to do things and it's great to know we're very in line with each other 🙂

  7. good stuff man..btw Dominion Energy for the long run.. many many years of 10% div increases..currently at a record high initial yeild of 5+% due to price drop due to SCANA bid . With D u get a solid 48 billion market cap utility w future liquified nat gas exporter and more. trading at 52 week low..

  8. Hey Ian, thanks for another great video! I was actually going to ask about strategy when it comes to adding to positions, so this was great. I'm still trying to decide on some core stocks (trying to look at dividend kings with 100+ years of operating like I commented last time). So far I've got my eyes on Johnson&Johnson (JNJ), Proctor&Gamble (PG), Coca-Cola (KO), Colgate-Palmolive (CL), and Hormel Foods (HRL) as they meet those standards and their earnings went up during the Great Recession. I really respect your opinion and was hoping to get your take on this as a starting point for the core of a portfolio. Also, I was contemplating adding more pharma stocks to the core watchlist, do you have any suggestions? Very few seem to have long dividend or operational history, and that's before I even start looking at PE ratios and earnings. Thank you so much for taking the time to respond to my last comment, I really appreciate that you drop knowledge on the new cats trying to get started.

  9. Okay you own 37 stocks !! how do you go about adding money to each one of them stocks, do you go one at a time? How much ?

  10. What about once you have checked and found you a dividend stocks. How much money add to Build up the stock up $100, $300, $500 or $1000 what would you suggest and what about if you vest in 2 stocks ,how much should you be adding every week, or every month, to that stocks

  11. I'm loving how frequent these videos are being uploaded. I feel like this channel is about to blow up and get noticed by a wider audience soon. Looking forward to seeing those subscriber numbers go up! Keep up the great work Ian, always a pleasure to see a new video in my inbox.

  12. Disney seems great -would great to see a vid of them and Apple as big brands with big potential dividend growth. I hope one day you would share your portfolio. It would be so interesting -you could put disclaimers that you did not buy at current prices and if you want to include entry point that would be awesome. Your content is great and I think it would take your subs to the next level. Anyway -much respect whatever you decide but I hope you share them all—great vid

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