Monday, July 1, 2013
Freedom Fund Update - July 2013
Well, the time has come to update the Freedom Fund once again as we start another month. The Freedom Fund is my portfolio, and I think it's aptly named. My portfolio is my way to freedom; freedom from a job I don't desire to purchase goods I don't need to impress neighbors I don't care about. This journey is all about freedom and flexibility. One day the dividend income this portfolio generates will fully replace my day job's income and my time will be completely my own. What could you possibly want to own more than your time?
I feel extremely fortunate and thankful that I'm able to post these updates every single month which shows the power of monthly contributions to investments because of the high savings rate I maintain. It shows how a relatively large sum of money can be built through the power of time, patience and perseverance.
It's important to keep in mind that while updating the overall value of my portfolio is important for historical reference and for purposes of keeping track of total return, my main focus is on the rising dividend income stream the Fund provides.
The Fund was busy during the month of June. I initiated a position with Digital Realty Trust, Inc. (DLR) very early in the month, and then shortly thereafter followed that up with an investment in Oneok, Inc. (OKE). Finally, I happily initiated a position with General Electric Company (GE). Whew! That's a lot of capital invested into the market at a time when some people are predicating calamity. I don't know what's going to happen tomorrow or the next day, or 6 months from now. I only know that it's a proven fact that a surefire way to build wealth is to invest in high quality assets, preferably those that produce prodigious cash flow which can be distributed back to the owners. My method is to invest my heard earned capital into high quality companies that have a good track record of returning higher dividends to shareholders because they're earning ever higher profits on the back of a wonderful business.
The current market value of the Freedom Fund stands at $117,096.07. This is an increase of 3.8% over last month's published value of $112,842.62. I'm extremely excited when my portfolio can grow by that much in a month, mostly due to new capital and dividends. It would be a dream to grow it that much every month, but alas I earn a middle class income and I still have to pay for rent, food and other basic expenses.
Looking forward, I'm hoping we see some fantastic buying opportunities over the next month. Certainly Mr. Market has not been kind to those of us who are interested in purchasing high quality equities, as great deals are few and far between. I'll continue to scan for value where I can find it, as I talked about very recently.
I'm currently invested in 36 companies. This is an increase since last month's updates to the aforementioned new investments.
These updates are mainly designed to show the increase in the value of the underlying equities I'm invested in, but the main purpose of investing in dividend growth stocks is for the rising stream of dividends over time. So with that said I don't put too much emphasis on these monthly updates on the value of my portfolio. I think it is a good idea, however, to keep track of the rising (or falling) value of one's securities and be aware of where they are in terms of the marketplace and whether or not certain stocks are attractively priced. It proves to be a useful exercise, for me at least, to update the values monthly. It gives me fresh perspective on which equities are performing well and which aren't, and from there I can make educated decisions (based on further due diligence) on which stocks I'd like to add fresh capital to (while considering portfolio weight as well).
Full Disclosure: Long DLR, OKE, GE
Thanks for reading.
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