My way of finding the buying opportunity of a stock during the Bear market

Finding the entry point of buying stock during the Bear market

The market is at the bear market as it fell more than 30% in March. I have created a list that contains all of my stocks in my portfolio and some other stocks which are on my watch list for quite a long time. I have made a price comparison chart of all those stocks which compares how much the price drops from their 52 weeks high. I have also added each stock PE ratio and Current yield although for many of them the PE and current yield will change significantly. I have also calculated the price of each stock at 20%, 30%, and 50% down from their highest price. The 52 weeks high has been extracted from google finance and the PE and current yield are from yahoo finance. The energy sector got hit the most with an average of around -60% from their recent highs. The next sector that got hurt is the financial sector which is down with an average of around -30%. The best sector is so far is the consumer defensive sectors. The table below shows the energy sector performance

Energy Sector:

All the major energy stocks dropped more than 50% except Chevron but very close to 50%. The prices are really attractive but in this situation, it's better to stay away from any energy stocks. In my portfolio, I am holding BP, CVX, and XOM. I am not selling them and holding them for the longer term.

REIT Sector:

The REIT sector was also down big until the recent rally recovered from the low prices. I have started my position in realty income (O) @40.5. I was watching the stock for a long time but the price was really high just a few months ago. I will add more O if the price drops below $40 which will be more than 50% down from its 52 weeks high.

Financial Sector:

The financial sector is also down big. I was so lucky to sell all of my BAC stocks in mid-february @$34.5. I took a good amount of profit from BAC. I am not planning to add any bank stocks now. Although their PE is very low, I am expecting more than 50% drop in JPM and BAC. Their earnings will drop for sure and the PE will increase. I will add JPM if it drops below $60 and BAC below $12.

Industrial Sector:

I was very active to buy stocks in this sector in mid-March. I have added CAT, EMR, HON, and MMM stocks while sold 75% of my DAL position in February @$49.5. The prices were very attractive and I am investing in those stocks for a longer-term. Emmerson (EMR) and 3M (MMM) are the dividend kings who are increasing their dividends for more than 60 years. I have added enough MMM, now I will gradually increase my position in CAT and HON in the next few weeks.

Consumer Cyclical:

This is another sector that I love to invest a lot. GM and LEG are down almost 50%. LEG is a dividend aristocrat. It raised its dividends for the last 47 years. I have added a few LEG @$25.5. I have also added MCD and SBUX in mid-march @$128.66 and @$52.5 respectively. I will add more SBUX if the price drops below $50. I am also watching HD. I will add them @$140. I am also watching Nike for a long time but unfortunately, the stock is always overvalued. I will look for an entry @$52.

Consumer Defensive:

This is the best performing sector so far in the market. Still, I don't see any buying opportunity in this sector as their PE ratio is still high. I may add PEP if the price drops below $100 and KO below $33.

Communication:

In this sector, two of my favorite stock is At&t(T) and Disney (DIS). Disney was down big before the recent rally. I have added a few DIS stocks @$82.5. I will add more DIS if it drops below $78. I have also added T in mid-March when the price dropped below $27.

Healthcare Sector:

In the healthcare sector, I already own too many stocks of ABBV and BMY. The only stock I am adding in this sector is JNJ. recently I have added JNJ @122. I will slowly add more JNJ if the price drops even more.

Technology Sector:

I own AAPL, MSFT, CSCO, and TXN in my portfolio. I am adding any AAPL and MSFT as their PE is still high. I will add more CSCO if the price drops below $30.

Utility Sector:

In this sector, I own D and PPL. I was watching SO and DUK for some time. Recently I have added SO @ $44.5 and DUK @ $70.5. I will add more SO and DUK if the price drops around 40% from their highs.

Portfolio Update - January 2020

Portfolio Update - January 2020

Today I am sharing my portfolio at the end of January 2020. This blog was written two weeks ago. I was very busy in the last few days so at the current situation of the market the prices of the stocks has a big difference. I will update my current portfolio as soon as possible. As of January I was holding 33 stocks. This month I have sold all of my positions in L Brands (LB). I sold them at $23.4 at the end of January which I bought at $17.4 in November 2019. I got 35% profit in just 2 months of holding. The chart below shows my current portfolio and sector distribution of the portfolio.

The pie chart below shows diversity. The chart indicates a well-diversified portfolio with Apple (AAPL) is my highest position. I bought them in December 2018 and since then it keep increasing. My other top holdings are JP Morgan (JPM) 5.9%, Home Depot (HD) 5.6%, Abbvie (ABBV) 5%, and J&J (JNJ) 4.8%. 

The sector distribution of my portfolio is shown in the following pie chart. The sectors are based on Yahoo finance. My highest position is in the consumer sector with 19.9% (combined). My next large sectors are the technology, financial, and health sectors with 16% each.

I always update my trades in the tipranks website. The figure below compares my portfolio performance against the S&P 500. Most of the cases my portfolio beats the market.

My performance as a portfolio manager is also good. I am ranked 725 out of 23,372 investors which is in the top 3%. My portfolio has gained 69% since I started to invest in the market in 2017 and my sharp ratio is 3.04 while the average is only 0.99. The sharpe ratio is "A measure of your returns and associated risk you take on compared to returns of risk-free assets".

My 12 month returns (TTM) is 30.84% while the YTD return is 7.97%. At the time of writing of the blog the market tumbled almost 10%. So this chart does not count the last 2 days drop.

The meter below shows my projected income in terms of dividends. On 31st January 2020, my projected income through were $1214.38. I have accomplished my first target of earning $100 monthly through dividends. My dividend income increased 3.4% compared to the last month. I have added some oil stocks in this month such as British Petroleum (BP), Chevron (CVX), and Exxon Mobil (XOM). All the oil stocks are down big and I am bullish about the future outlook of this sector. On the other hand I have sold my positions in Gaps (GPS) and L Brands (LB). I have got some nice profit from these two stocks in just 2 months of investment.

My current Yield on cost is 3.78% while my current portfolio yield is 2.99%. Because I am investing in dividend growth stocks so my YOC will continue to grow with time while the current yield depends with the market volatility. The yield will go up when the market is down and the vice versa.

The following figure shows the comparison of my current yield and the YOC with time. My YOC is higher than the current yield because of the bullish market. For longer term, if I keep investing in dividend growth stocks, my YOC will keep growing with time.

The following chart shows my growth in projected annual income with time. It is slowly but steadily increasing and this month it reached to my first goal of earning $100 per month.

The table below summarizes the dividends that I received in January 2020. This month I have received $62.34. My highest paying dividend paying for this part of the quarter is from Jp Morgan Chase ($16.24).

The following table shows the detailed performances of my portfolio. The current prices are based on January 31st 2020. So the prices do not reflect the current price in the market. In the chart, I shared my current positions, annual income that I will receive in a year, total recieved dividends from the companies, and finally the gain or loss for each company. Please note that I have added the total dividends received to calculate the gain or loss for each company. The top 3 stocks in terms of gain are Mastercard (MA), Microsoft (MSFT), and Apple (AAPL).

Dividend Received on October 2019

Dividends received in October 2019

In October 2019, I have received a total of $60.83 in dividends. The chart below shows the dividends that I received each month in 2019. This cycle I used to receive the least income compared to the other quarters. The majority amount of dividends I received in the last month was from JP Morgan (JPM) and Medical Properties (MPW). This month I have received dividends from my new addition PPL Corp (PPL) for the first time. 

The next table shows the total dividends received in 2019 from my portfolio. In total, I have received $753.48. 

The next table shows my dividend growth performance so far in 2019. The last column of the chart shows the change in dividends compared to the previous year. The box marked green indicates the percentage of dividends increased in the current year while the box with red means a decrease in dividends this year. In the last month, I got a dividend raise from Visa (V). They raised their dividends 20%. This year all the stocks in my portfolio raised their dividends except Kraft and Heinz (KHC). 

The chart and table below summarizes my dividend distribution in the portfolio. The most percentages of dividends I am receiving are from ABBV and At&t (T) with 10.1 and 8.6% respectively.

The following chart shows the dividends received monthly from my portfolio. The chart clearly indicates the growth of my monthly dividends with time.

The following chart compares my monthly dividends on a yearly basis. In October 2019, I have received $60.83 while in 2018 in the same month I received $42.62 which is 42.73% YOY growth.

The next chart shows the total amount of dividends received on a quarterly basis. This year my quarterly income remains the same but I am expecting an increase with this quarter because I sold some of my high yield BDC and REIT stocks in May and June and it took me some time to buy new stocks. the recent time I invested in MMM, PPL, and XOM, so I am expecting a good increase in my dividends this quarter.

So far my current yield is 2.98% and my yield on cost (YOC) is 3.59%. The increase in YOC is due to the dividend increase of some of my stocks. However, the current yield dropped because of the bullish market.

My projected annual dividends in October 2019 is $1068. My first goal is to earn $100 monthly which is $1200 a year. I am moving towards my goal gradually every month as you can see from the chart below. I am investing 8% of my salary monthly and also reinvesting all the dividends that I am receiving.

Dividends Received in August 2019

Dividends Received in August 2019

In August 2019, I have received in total $81.24 in dividends. The chart below shows the dividends that I received in August 2019. In this month I have received dividends from my top 2 dividend-paying stocks At&t (T) and Abbvie (ABBV). In total, I have received $44 from these 2 companies. Other than that I have received dividends from Apple (AAPL), Delta Airlines (DAL), Procter & Gamble (PG), and Bristol Myers Squibb (BMY). DAL raised 15% dividend and I got $1.05 higher than the last quarter.

The following chart shows the dividends received monthly from my portfolio. The chart clearly indicates the growth of my monthly dividends with time.

The following chart compares my monthly dividends on a yearly basis. In August 2019, I have received $81.24 while in 2018 at the same month I received $70.25 which is 15.64% YOY increase.

The following chart shows my dividends amount on a quarterly basis. There's a double increase in my dividends compared to the same quarter last year. 

The next table shows my dividend growth performance so far in 2019. The last column of the chart shows the change in dividends compared to the previous year. The box marked green indicates the percentage of dividends increased in the year 2019 while the box marked red means a decrease in dividends this year. In the last month, Medical Properties (MPW) increased their dividends 4.04%. So far only one stock in my portfolio cut the dividends. Other than that all the companies raised their dividends. This quarter HON, MCD, MSFT, T, TXN, and V will raise their dividends.

The table next shows the monthly dividends received so far from each company and the table also shows my year to date income from dividends which is $596.86.

My projected annual dividends in August 2019 is $1010.42. My first goal is to earn $100 monthly from dividends which $1200 a year. I am very close to that goal. I will keep investing in dividend stocks monthly and reinvesting the dividends.

The chart below shows my dividend distribution in the portfolio. The most dividends I am receiving is from ABBV (10.6%) followed by T (9.1%).