This week, up to date financial data was launched as CPI elevated to three.4% from 3.1% in December. The Core CPI print got here in at 3.9%, which was a decline from 4% in November. Outdoors CPI, the producer price inflation rate declined by 0.1% in December as items value dropped for the third consecutive month by 0.4% as diesel costs declined by 12.4%. Whereas there was a slight dip in the midst of the week, the S&P 500 rose 1.58% over the previous week, whereas the Nasdaq elevated by 2.6%. All eyes can be on the Fed because the next meeting on January 31^st is quickly approaching. CME Group is projecting that there’s a 94.8% likelihood that charges will stay unchanged, and if that is the end result, I might take into account it a win. I need to get by the subsequent assembly with no shock enhance, particularly since a few of the Fed members might get spooked with CPI ticking up in December. The very last thing that the Fed needs is to see inflation enhance after taking charges to the best stage in a long time and coming so near a comfortable touchdown. Regardless that there’s a 76.9% likelihood that charges will get lower on the March assembly, I nonetheless assume Could is the extra probably situation at this level, particularly with the newest financial information. It doesn’t matter what, I’ll proceed to allocate capital every week and construct out the Dividend Harvesting Portfolio.

I am unable to consider 150 weeks have handed by, and I’ve now allotted $15,000 to the Dividend Harvesting Portfolio. For some individuals, that is some huge cash, and for others, it is not. Along with constructing out a dividend portfolio from the bottom up, I wished to point out youthful or starting buyers that it is by no means too early to start out saving in your future. Regardless of how a lot capital it can save you, in the event you keep it up, it’s possible you’ll be shocked at how a lot it could develop over time. 2024 is off to a great begin because the Dividend Harvesting Portfolio completed up 8.51% ($1,276.84) on invested capital with a stability of $16,276.84. This was a robust week as $41.89 in dividend revenue was generated. Week 150 was reader suggestion week, and I took a reader suggestion from some time again that remained on my watchlist and to which I’ve been paying nearer consideration. The week 150 addition was Starbucks (SBUX), and I’m pleased to be a shareholder in an organization that I spend cash with. The mixture of including Starbucks and reinvesting the generated dividend revenue elevated my ahead projected dividend revenue by $6.27 (0.48%) to $1,322.77, which is a ahead yield of 8.13%. I’m excited to see the place issues go in 2024, as there may be going to be a whole lot of dividend revenue being generated and reinvested as new capital is allotted every week.

The general efficiency of the Dividend Harvesting Portfolio since inception

I admire all of the feedback, and typically I’ll deal with sure issues within the weekly articles along with the remark part. Final week, somebody indicated that I used to be going about this portfolio incorrectly and that I ought to think about a number of high-quality corporations somewhat than diversify throughout many low-quality corporations.

I’m constructing this portfolio to suit my particular targets of producing reoccurring dividend revenue whereas mitigating draw back threat. Even the very best corporations get offered off every now and then. For instance, Meta Platforms (META) went from $382 to round $90 within the span of roughly 13 months, whereas Amazon (AMZN) fell from $183 in the midst of November 2021 to round $84 on the finish of December 2022. The way in which I’m mitigating my draw back threat and the danger from dividend cuts is thru diversification. Intel (INTC) of all corporations fell on exhausting occasions, and whereas its rebounded over 55% up to now yr, it was pressured to chop its annual dividend by -64.86% from $1.48 per share to $0.52. This got here after virtually 2 a long time of dividend growth and hundreds of billions in of earnings. One of the best ways for me to mitigate my threat is by diversifying throughout totally different industries whereas including ETFs and CEFs. This might not be the very best methodology for some individuals, and that is superb. My desire for this portfolio is to create excessive diversification as I’m not in a contest to beat or replicate the returns from the S&P. It is a particular portfolio with particular targets, and that is how I’m constructing it out. Trying on the chart beneath, the Dividend Harvesting Portfolio has delivered on my targets regardless of the macroeconomic cycle or what geopolitical tensions have arisen.

The Dividend Harvesting Portfolio dividend part

Here is how a lot dividend revenue is generated per funding basket:

Equities $377.76 (28.56%)
ETFs $297.92 (22.52%)
REITs $262.21 (19.82%)
CEFs $231.38 (17.49%)
BDCs $153.50 (11.60%)

Amassing dividends can serve many capabilities in a portfolio. Some buyers make the most of dividends to complement their revenue and dwell off of them. I am constructing a dividend portfolio for myself 30 years into the longer term. In 2022, I collected $507.80 in dividend revenue from 533 dividends. In 2023, I collected $978.11 in dividend revenue from 660 dividends. After the primary 2 weeks in 2024, I’ve collected $73.99 from 28 dividends. That is 7.58% of the whole dividend revenue generated in 2023 from 4.24% of the dividends produced.

These dividends permit me to achieve further fairness in my investments whereas rising my future money movement in down markets. This type of investing is not for everybody, however in the event you’re seeking to generate constant money movement whereas mitigating draw back threat, this technique has labored for me. The Dividend Harvesting Portfolio completed sturdy in 2023, and I’m seeking to generate $1,500 of dividend revenue in 2024 whereas attending to the purpose the place I by no means dip beneath $100 of month-to-month dividend revenue being generated.

The primary 2 weeks in January have completed, and I nonetheless have one other 12 days of dividends being generated to shut out the month. November was the primary time that the Dividend Harvesting Portfolio generated $100 of dividend revenue in a single month after lacking the $100 mark in October by $0.38. Reaching $100 once more in December fell quick because the Dividend Havretsing Portfolio generated $92.38 from its dividends. After the primary 2 weeks of January and producing $73.99 it actually feels just like the $100 goes to be shattered. We’ll must see what happens, however I’ve a great feeling that that is the start of triple-digit month-to-month revenue on an ongoing foundation.

The Dividend Tracker is indicating that one other good week of dividend revenue can be generated the week of the 15^th. The Dividend Harvesting Portfolio is projected to generate roughly $18.53 of dividend revenue subsequent week and roughly $121.38 for the month of January. After I look by the entire dividends which might be presupposed to be generated, I get much more optimistic that the times of double-digit month-to-month revenue are a factor of the previous. Solely time will inform, and as soon as this aim is achieved, the lengthy highway to quadruple-digit month-to-month revenue begins.

I’ve obtained some work to do. There are nonetheless 29 positions which might be producing at the least 1 further share by their dividends on an annual foundation, which is driving an estimated $99.06 of ahead dividend revenue. I’m engaged on getting extra positions over the road and into the inexperienced sector of the desk beneath. Finally, I want to have each place producing at the least 1 share on an annual foundation, however that may take years to perform. For 2024 I’ll do what I can to maneuver a bunch of those corporations within the appropriate route. I’ve no sequence that I can be following, however I’ve a sense that over the subsequent few months, the desk beneath will look considerably totally different.

The Dividend Harvesting Portfolio Composition

REITs ticked up a bit and are nonetheless a bit over the 20% sector threshold I’m attempting to stay to. It has been troublesome for me to not add to Starwood Property Belief (STWD) or Realty Revenue (O) at their present costs, however I’m attempting to get this sector below 20%. My money place elevated to $200.93 this week, however there could possibly be a couple of {dollars} that have to be reinvested, typically it is on a lag. Both method, I plan on including to my money place and have been serious about placing it in an ETF comprised of short-term T-bills somewhat than holding it within the sweep account. We’ll see what occurs. The extra I give it some thought, if Apple (AAPL) sells off into earnings and will get to round $175 or so, I’ll use the money to start out a place in AAPL.

Particular person equities now signify 37.71 % of the Dividend Harvesting portfolio whereas producing 28.56% of the dividend revenue. REITs, ETFs, CEFs, and BDCs make up 62.29% of the portfolio and generate 71.44% of the ahead revenue. I plan on including to each asset class inside the Dividend Harvesting Portfolio all through 2024, however within the early levels, I’ll attempt to divert capital away from REITs.

Altria Group (MO) is again on the transfer once more, because it has retaken the highest spot within the Dividend Harvesting Portfolio from Verizon (VZ). AT&T (T) was additionally kicked out of the ten^th spot after making it again onto the top-10 checklist by the PIMCO Dynamic Revenue Fund (PDI). Outdoors of the top-3, the positions are actually beginning to flatten out, and I feel that as time progresses, this may proceed to happen. I’m tempted so as to add to Altria Group and Verizon going into earnings, so we are going to see how the top-10 seems to be over the subsequent a number of weeks.

Thanks for the suggestions on the deeper dive into the top-10 holdings. I want I had the time to do that for each place, nevertheless it’s quite a bit to maintain up with. If I may determine tips on how to automate this it will be nice, however till then, I feel I’m solely going to offer these statistics for the top-10 holdings.

I’ve allotted $4,842.89 to the highest 10 positions within the Dividend Harvesting Portfolio, and so they have generated $490.87 in dividend revenue. Total, these positions have generated 10.14% of my unique funding from their dividend revenue. These positions are actually value $5,455.70, which is an ROI of $612.81 or 12.65%. These positions are projected to generate $458.18 in annualized revenue, which is a ahead yield of 9.46%. The highest-10 holdings inside the Dividend Harvesting Portfolio signify 33.61% of the whole portfolio worth whereas contributing 34.64% of the whole dividend revenue being generated.

Week 150 additions

In week 150, which was Reader Suggestion week, I added Starbucks (SBUX) to the Dividend Harvesting Portfolio. I wrote a devoted article on Starbucks outlining my funding thesis, which might be learn by clicking here.

Starbucks

I feel that Starbucks has a long-term alternative to generate further profitability because the coffee market expands. From 2024 to 2029, the espresso market is predicted to develop at a 4.72% CAGR from $132.13 billion to $166.39 billion.
Starbucks opened 816 web new shops of their 2024 This autumn, bringing their whole stress for the 2023 fiscal yr to 38,038. Starbucks remains to be increasing their world footprint, which ought to result in prime and bottom-line progress for years to come back.
Starbucks issued sturdy steerage for 2024, which included their world comp progress to be 5-7%.
Starbucks has elevated its dividend over the previous 13 years at a 20% CAGR. Including Starbucks at a 2.45% yield and paying 19 occasions 2025 EPS works for me.

Subsequent Week Gameplan

Subsequent week I’m contemplating including to my positions of Brystol-Myers Squibb (BMY), Altria Group (MO), JPMorgan Nasdaq Fairness Premium Revenue ETF (JEPQ), and Morgan Stanley (MS). We’ll see what happens; finally, I might love so as to add to all of them, however working with a price range of $100 would not permit me to take action. I actually like Brystol Myers and Altria going into earnings, in order that could possibly be an fascinating mixture.

Conclusion

After 150 weeks, the Dividend Harvesting Portfolio goes sturdy. I am unable to predict the longer term, and the underlying portfolio has been in a position to stand up to many various obstacles alongside the way in which. I feel that the powers of compounding are actually going to start out being noticeable as extra dividend revenue is being reinvested on a steady foundation. It is exhausting to complain while you’re up $1,276.84, and the portfolio generates $1,322.77 in ahead dividend revenue. I’m excited to proceed including capital to this portfolio and documenting the method. Trying on the chart beneath, the ahead dividend revenue has come a great distance, and roughly $25 per week is now being generated. Please depart your entire feedback and strategies beneath as I attempt to work together with everybody within the remark part.