Adrian Vidal/iStock via Getty Images This has been an incredibly hard market to be an individual stock picker in. For investors focused on indexing, it’s all the same, just allocate to an index fund every few weeks, and ultimately, you will do very well in the future. The Nasdaq technically entered bear market territory as it had declined more than 20% from its highs, taking out its previous lows in February. The markets witnessed a sharp reversal as they closed in the green over the next 4 trading sessions. Last week the Dividend Harvesting portfolio was still in the black but was tendering on the edge as it was up just 0.73% based on my initial investment. The combination of the markets having several green days and dividends flowing into my account has allowed the Dividend Harvesting portfolio to close in the black for the 54th time in 55 weeks. I have allocated $5,500, and I am in the black by $209.54 (3.67%) as the ending balance was $5,709.54. In week 55, I added a new position, VICI Properties ( VICI ), and I dollar cost averaged into several other positions. I am now generating $388.58 in annual dividends from this portfolio which will continue to be reinvested. Regardless of inflation, geopolitical tensions, or economic uncertainties, my dividend approach with a wide diversification has held up well, and to date, the Dividend Harvesting portfolio has closed in the black 98.18% of the time (54/55).
This series has never been about hitting a target yield, generating a certain amount of profit, or beating the market. I had two specific goals with this series. The first was to create a blueprint for constructing a dividend portfolio by documenting the journey starting from the beginning. The second goal was to illustrate how allocating capital each week toward investing regardless of the amount would be beneficial in the long run. Too many people are under the illusion that you need tens of thousands or even hundreds of thousands to benefit from investing. Instead of using my real dividend portfolio as an example, I decided to start a new account, fund it with $100, and add $100 weekly, providing a step-by-step guide to dividend investing. This methodology doesn’t have to be used for dividend investing, and it could be as simple as an S&P index fund or a Total Market fund. Hopefully, this series is inspiring people to invest in their future to attain financial freedom. Steven Fiorillo The Dividend Harvesting Portfolio Dividend Section
After 55 weeks, the annual dividend income from the Dividend Harvesting portfolio has almost reached $400. This chart represents exponential dividend growth as the snowball effect is still in its infancy. By making weekly investments in income-producing investments and reinvesting the dividend income, the annual income continues to grow at a rapid pace. Originally, the first week’s allocation of $100 allowed me to generate $7.44 in annual dividend income. Since the start of week 2, I have added 59 positions which have grown my annual dividend income by $381.14 (5,123%). By making these investments, I have created my own source of additional cash flow, which is the real premise of this portfolio. Dividend Harvesting Portfolio Here’s how much dividend income is generated per investment basket Equities $139.22 (35.82%)
ETFs $84.07 (21.63%)
CEFs $73.78 (18.98%)
REITs $68.52 (17.63%)
BDC $16.26 (4.6%)
ETNs $5.10 (1.31%)
Dividend Harvesting Portfolio Dividend Harvesting Portfolio Collecting dividends can serve many functions in a portfolio. Some investors utilize dividends to supplement their income and live off. I am building a dividend portfolio for myself 30 years into the future. Since I am reinvesting every dividend, they serve multiple purposes today. In 2022 alone, I have collected $79.18 in dividend income over 11 weeks. This has allowed the Dividend Harvesting portfolio to stay in the black while growing the snowball effect. In down markets, these dividends allow me to gain additional equity in my investments while increasing my future cash flow. This style of investing isn’t for everyone, but if you’re looking to generate consistent cash flow while mitigating downside risk, this method has worked for me. I am hoping to collect between $450 – $500 in dividends in 2022, which will be reinvested, and finish the year generating >$700 in annual dividends. Dividend Harvesting Portfolio Well, in week 55, I added VICI, so my annual dividend count has increased to 476. I didn’t add an additional week of dividends, but I am back on the dividend growth […]
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