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).

Monthly dividend update - January 2020

January 2020 - Monthly Dividend Update

In January 2020, I have received a total of $62.34 in dividends. The table below shows the amount of dividends that I have received from the companies. This part of the quarter I receive the least amount of dividends. My highest paying company is JP Morgan (JPM) stock then followed by Medical Properties (MPW). This month my YOY is only 13%. I have added a few stocks of PPL corp and added GAP Inc (GPS) for a short time. Because of the addition, my dividends increased from 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 the last month, I have received $62.34 while in the same month in 2019 I received $54.7 which is 13% YOY growth in income through dividends.

The next chart shows the total amount of dividends received on a quarterly basis. My previous two years had seen an increase in dividends every quarter. This year I am also expecting a similar increase in dividends. 

On a yield basis, the current yield of my overall portfolio is 2.99% while my yield on cost (YOC) is 3.78%. For a dividend investor like me, YOC is an actual yield than the current yield. The current yield varies with the market condition. The bull market moves the yield lower and vice versa for the bear market. However, the YOC only increases with time if you invest in dividend growth stocks. If you only invest in these types of companies your YOC will only increase with time. 

My projected annual income in January 2020 is $1214.38. This month my dividend income increased by $40 in total. This is the first time my annual income crossed $1200 limit which was my first goal to earn $100 monthly from dividend income. That's a real passive income. I will keep investing every month and just imagine how much my monthly income will grow as time passes by.

The chart below shows the average dividend income received monthly and the average amount of dividends received monthly. I am slowly increasing my passive income and if I continue to invest in the dividend-paying stocks it will only grow. At the time of retirement, I don't need to rely only on my social security income.

The chart and table below summarize my dividend distribution in the portfolio. The most percentages of dividends I am receiving are from ABBV and T. I also invested in BP this month so my 3rd highest paying dividend stock is BP. I am planning to add more BP this month. I am also worried about the Kraft & Heinz (KHC) stock. They lowered their dividends last year and some analysts are saying that they will again lower the dividends. If they again decrease then my income will be lower. Its dividend safety score is only 29 so there is a high chance that they will cut their dividend again. So I am planning to make my position to less than half and will buy BP with that money. 

The following table shows the dividends that I received from my positions in each month. In January 20 I have received dividends from JPM, MPW, IRM, and PPL mostly. 

The next table shows the total dividends received in 2020 from my positions. So far this month I have received $62.34. This chart will help me to keep a record of my yearly income.

The next table shows my dividend growth performance in 2020. Out of my 33 stocks, 10 of them already increased their dividends. Bristol-Myers Squibb (BMY) and Chevron (CVX) increased their dividends 9.8 and 8.4% respectively compared to the last years 4 and 6% increase. ABBV, Mastercard (MA), and Comcast (CMCSA) also increase their dividends 10.3%, 21.2%, and 9.5% respectively.

Portfolio Update - December 2019

Portfolio Update - December 2019

Today I am sharing my portfolio at the end of December 2019. I am holding 34 stocks in my portfolio. This month I have opened 4 new positions in my portfolio. I have initiated my positions in British Petroleum (BP), L Brands (LB), and Gap Inc (GPS). I am long on BP but I am not long on LB and GPS. I am expecting a short term gain from LB and GPS. They are pretty much down in December and in my opinion, I think they are undervalued. In the coming earnings time, I am expecting a big jump in these two stocks. I am also holding cash because at the current situation of the market it's really hard to find an undervalued stock. The chart below shows my current portfolio and sector distribution of my portfolio.

The pie chart below shows diversity. The chart indicates a well-diversified with Apple (AAPL) is my highest position. Apple's recent surge increased my holding percentage a little high. My next big holdings are JP Morgan (JPM), Abbvie (ABBV), Home Depot (HD), and 3M (MMM).

The sector distribution of my portfolio has been shown in the following pie chart. The sectors are based on Yahoo Finance. My highest position is in the consumer sector with 21.5% combined (both consumer and defensive). My other largest sectors are the healthcare, financial, and technology sectors respectively. 

The meter below shows my projected income in terms of dividends. On 31st December 2019, my projected income through dividends were $1174. I have set my first target to $100 per month form dividends which is $1200 per year. Compared to last month my dividend increased from $1079.89. The increase is due to my investment in higher yield stocks such as. Gap Inc (GPS), L Brands (LB), and British Petroleum (BP).

The current yield of my portfolio is 2.93% while my Yield on Cost (YOC) is 3.75%. Because of my investment in high yield stocks, my income increased 0.05% compared to the last month.

The following figure shows the comparison of my current yield and the YOC with time. It shows that the YOC of my portfolio is going up while my current yield is below the YOC. Because I invest in dividend growth stocks that's why my YOC will keep increasing with time. However, current yield depends on market volatility. If the market is up the yield drops and if the market is down then the yield increases.

The following chart shows my growth in projected annual income with time. It is slowly but steadily increasing and reaching to achieve my first goal.

The table below summarizes the dividends that I received in December 2019. This month I have received the highest amount of dividends. The increase is due to the addition of MMM and JNJ stocks and dividend increases from JNJ, MSFT, V, and MCD.

The following table shows the detailed performances of my portfolio. The current prices are based on December 31st, 2019. So the prices do not reflect the current price in the market. In the chart, I have shared my current positions, annual income that I will receive in a year, total received 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. My biggest gain so far is MSFT, MA, AAPL, V, and PG. I am invested in a long term in all the companies.

Monthly Dividend Update December 2019

December 2019 - Monthly Dividend Update

In December 2019, I have received a total of $119.65 in dividends. The chart below shows the amount of money received in dividends each month in 2019. This month was the highest amount I received since I started to invest. This month my dividend increased from $101.56 to $119.65 which is a 17.8% increase compared to the last quarter (September). The increase is due to the addition of Exxon Mobil (XOM) in my portfolio. I have also purchased a few stocks of Johnson & Johnson (JNJ), 3M (MMM), and Emerson Electric (EMR). Other than that my income also increased because of the dividend increase from Pfizer (PFE), Microsoft (MSFT), McDonald's (MCD), and Visa (V). On the other hand, I have sold half of my positions in Honeywell (HON). Because of this, my dividend decreased a little bit. 

The next table shows the total dividends received in 2019 from my portfolio. In total, I have received $968.59 in the year. Last year I received $422 in dividends. So this year I have doubled my income.

The next table shows my dividend growth performance 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 dividend raise from Bristol-Myers (BMY) 9.8%, Dominion Energy (D), 2.5%, Iron Mountain (IRM) 1.23%, Mastercard (MA) 21.2% and At&t (T) 2%. The increase in dividends raised $8 income in a year. In 2019, I got raised from all the companies except The Kraft & Heinz (KHC).

The chart and table below summarize my dividend distribution in the portfolio. The most percentages of dividends I am receiving are from ABBV and T. I need to diversify my dividend income. I am receiving most of my dividends from a few companies. Specifically, I am worried about KHC. They may cut the dividends again this year. Currently, it is 5.4% in my portfolio. So like last year it may significantly lower my income.

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 the last month, I have received $119.65 while in 2018 in the same month I received $82.36 which is 45.28% YOY growth.

The next chart shows the total amount of dividends received on a quarterly basis. This year, the first three quarters remained the same. However, This quarter my income increased compared to the last quarter.  This quarter my income is $270.17 which is 17.07% growth. Again, compared to 2018 Q4 it increased by 42.47%. 

My current yield is 2.93% and my yield of cost (YOC) is 3.75%. This month my YOC increase because of my investment in new stocks which has high yields and also due to the increase in dividends to a few positions in my portfolio.

My projected annual dividends in December 2019 is $1174.76. This month I got a $100 increase in yearly income through dividends. I have added three new positions in my portfolio. I will write about those new additions in my next blog.

The chart below shows the average dividend income received monthly. My average income is almost reaching my first goal of receiving $100 monthly.