Dividend Mantra

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Freedom Fund Update

By 7 Comments

Another month is over and it’s that time to update the Dividend Portfolio once again. I’ve decided to name my portfolio. Most hedge funds and mutual funds name their respective fund, and since I manage my own fund I figured I would name it.

My portfolio will now be called Freedom Fund.

I decided to name it that, because freedom is exactly what I’m looking for. By investing in dividend growth stocks I’m looking for freedom from the rat-race. I’m looking for freedom from being a wage-slave. This blog is documenting that journey. From here on, I will likely refer to my portfolio as the Freedom Fund.

I have updated the weightings that each company have, as they have changed from March due to market gyrations, as well as my recent purchases of JNJ and TEF. I haven’t made any other changes to the listing of the Freedom Fund, but I may include information on yield, DGR and other possible specs in the future.

I now own shares of 15 companies. I think this is an appropriate diversification level for me right now, based on the total size and market value of my holdings. I will discuss diversification in the near future, as there is a lot of disagreements between how much diversification is really necessary for an individual investor. I think the two most famous sides of each camp are Warren Buffett and Peter Lynch. Warren Buffett believes in concentrated bets on a few smart investments. Peter Lynch was famous for seemingly never coming across a stock he didn’t like. I don’t have a necessary goal in mind for how much diversification I’d like to have, but I think having shares of 25-30 companies when I’m all done is probably appropriate.

My total equities market value is currently at: $28,845.28.

This is an increase from my last published value of: $26,735.65. This increase is mostly due to my infusion of cash towards the end of March, with which I made my two purchases.

Overall, I’m satisfied with the progress of the Freedom Fund. I like all my holdings currently, the only one I have any thoughts of making a change with is perhaps TOT. It is not a dividend growth stock and I purchased it when the rig went down in the Gulf last summer. I think it’s still attractively valued and I purchased it with a yield near 7%, so my yield-on-cost is very attractive. I am holding on due to those two reasons.

I hope for continued success with the Freedom Fund.

Thanks for reading.

Comments

  1. I affectionately refer to mine as the “Go to H*!! Fund”, but then that name is not exactly politic and something you would not want to use in a polite society.

  2. Mantra,

    Just curious to see if you had a goal on mind for how many companies you were going to end the year with..ie, how do you determine when to add a new position? With my recent purchases in APR, I am close to my 2011 goal of adding 4 new companies.

    Take care,

    DivPartisan

  3. Dividend Partisan,

    I don’t really have a number in mind in terms of companies added or held. I have a a basket of about 40-50 companies I’m watching at any given time and I pick the most attractively valued at the time of purchase. That pick may or may not be already owned. Whether or not I already own the stock has a minimum net effect on my decision.

    Thanks for stopping by and commenting!

  4. Mark,

    Thanks for stopping by. I love JNJ and have a hard time keeping my hands off of it!

    I think 25 is probably an appropriate final number. I don’t have an exact number in mind, but as I wrote in the article…25-30 is probably enough for an individual investor to follow and appropriately mitigate risk without getting over one’s head.

    Thanks for commenting!

  5. Good stuff man. I like the name of the portfolio!

    I also own JNJ, I love that company.

    I’m also trying to own about 25 dividend payers, I think that’s a pretty good number to start seriously mitigating unsystematic risk.

    Cheers!
    Mark

  6. Ok, this is one part exciting – one part daunting. My trading portfolio has just hit this value – where you were back in April 2011… so I can track my progress along your historical path.

    I’m about 3 years behind you – oddly enough seems like a short AND long time to me at the same time… still going to be a few years before I get a 6-figure portfolio and truly see the magic of compounding like you enjoy now.

    I haven’t optimized my spending as well as you have either, so until I do, I’m effectively MORE than 3 years behind ya. I gotta whip into shape!!

  7. Adam,

    Hey, congrats on your recent milestone! That’s fantastic. And thanks for commenting here. This post brings back very fond memories. 🙂

    And don’t worry about comparing yourself to me, or anyone else for that matter. We all have different goals, means, situations, etc. There are many investors that have done way better than me in terms of portfolio value over the last few years, but they also make much more money than me. And I probably couldn’t have done as well as I did if I had children, so one’s lifestyle also has a role to play.

    However, I’m slowing down a bit right now due to my recent move from working full-time at the car dealership to focusing more on writing. So that may give you some room to catch up! 🙂

    Best of luck. And stick with it. Consistency, consistency, consistency.

    Cheers.

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