Dividend Stocks, Lunch Experiment Update:
Dividend Experiment Update
This month, long with the Stock market overall (the DOW is above 12,000 again… hooray), I gained in both EVEP and CIM! The stock ANH didn’t move staying the same price. If I could, I would like to get rid of ANH and buy something more conservative.
So far, I’ve been impressed with the performance of my experiment portfolio, I gained another 2% from last month. I’ve heavily invested in REITs, and I need to switch into another type of dividend stocks some day. Most likely, I will try to dump ANH… soon!
Background:
The Free Lunch Experiment, which invests in dividend stocks so that I can use the yield to pay for my work day lunches, is my first true experiment here at MoneyReasons.com and was started with the article called: “Paying An Adult Allowance, A Lunch Experiment”. As explained in the post link above, the money used in this experiment is sort of like free money because it would have been spent on eating lunches out at work anyway. This means that if I were to lose the money in this experiment tomorrow, it wouldn’t bother me because it really didn’t cost me anything to fund. Of course the probability of losing all my money in the stocks in the experiment is very slim.
Having practically free money in this experiment, I’m able to take higher risks that I normal would consider.
Now on to this month’s results!
| Stock Name | Anworth | EV Energy | Chimera | ||
| Stock Ticket | ANH | EVEP | CIM | ||
| # of Shares | 260 | 45 | 600 | ||
| Orig. Price | $7.84 | $23.25 | $4.01 | ||
| Curr. Price | $6.95 | $42.98 | $4.26 | ||
| Orig Cost | $2,038.14 | $1,046.25 | $2,404.80 | ||
| Curr Value | $1,807.00 | $1,934.10 | $2,556.00 | ||
| Annual Yield | 13.24% | 7.05% | 16.90% | ||
| Actual Dividend | $59.80 | $34.07 | $108.00 | ||
| Total Dividends | $807.48 | ||||
| 52 weeks | 52 | ||||
| Dividend / week | $15.53 | ||||
| Total Gain in | |||||
| Stock Apprec. | $807.91 | ||||
| % Change | 14.72% | ||||
| Amt Loaned to myself: | $1,726 | ||||
| Amt paid back to date: | $1,459 | ||||
| Amt Still Owned: | $267 | ||||
Priming the Pump:
As I stated in my previous posts, the money involved in this experiment is technically free money, to expedite the stock purchases I’ve borrowed money from myself a few times just to speed up the investing process, this action is called “priming the pump “. Of course I’m paying myself back. Currently, I still owe myself $267.
Modifications to the Experiment
I decided to wait to make changed to the experiment, I’m still rolling around ideas in my head, who knows… maybe I’ll end up putting the money in some dividend yielding mutual funds instead and just leave it g0! I wonder if I make enough in dividends if I’ll have to pay an estimated quarterly tax payment 2011?
-MR