Monday, September 30, 2019

BIG SHAKE UP IN MY PORTFOLIO


About two weeks ago, I stated I was going to sell Answorth Mortgage Asset Corporation (ANH) after they handed my the 4th  dividend cut in the past 2 years. 

So I did.  They're FIRED.


My whole investment strategy is to buy companies that have a record of raising their dividend, not cut them.  So I did what I had to do.

I knew it was a matter of time.  I bought them (and a few other REITs) because of the huge dividend payout (upwards of 10%). but in the long run, it will only dwindle down the tubes.

Plus their price had sunk to where I did not see a recovery.  ANH was down 27% this year alone.  a price drop did not mean they were a bargain since the dividend was also falling. Better to cut ties and invest in solid companies with a track record I can trust.

My mind and my heart was not in favor of REITs like this anymore.  IMO, REITs are a tease.  I still have shares in Realty Income (O), but at least they are keeping up with maintaining their dividend (and increasing it by tiny amounts every so often)

So I sold 3 REITs today that only brought frustration.   I got rid of ANH, Annaly Capital Management (NLY), and AGNC.   All three cut their dividends more than once recently and nothing is showing that that pattern will change.  I hate selling , but I feel relieved in a case like this.

Yes, I did have quite a return, and my Year To Year dividends will take a hit, but in the long run, I will gain more.

So here are my trades for September:

Ticker
Date
QTY
Price
total
DIV INC / Yr
EAT
9/3
30
$30.098
$1177.910
$45.60
CSCO
9/11
13
$49.999
$649.990
$18.20
RTN
9/20
4
$196.380
$785.520
$15.08
ANH (SOLD)
9/30
1137
$3.350
-$3808.870
-$454.80
AGNC (SOLD)
9/30
200
$15.965
-$3192.910
-$384.00
NLY (SOLD)
9/30
400
$8.705
-$3481.880
-$400.00
SYY
9/30
24
$79.039
$1901.890
$37.44
CSCO
9/30
37
$49.485
$1835.900
$51.80
MCD
9/30
9
$214.91
$1934.19
$41.76
RTN
9/30
4
197.815
$788.74
$15.08
BAC
9/30
17
29.255
$497.34
$12.24
DAL
9/30
68
58.203
$3957.86
$109.48
















$3045.68
-$892.12




As you can see, I am taking a $892 hit for the year in dividends.  I had already lost over $150 a year in dividends with the cuts from the REITs.  If they had kept up this pattern, I would be down $900 a year in 6 years If I did not sell. 

Now, in 6 years, I should be up a few hundred at the least.   I am on much more solid footing with purchases from the likes of Raytheon, Delta Air Lines, and Bank of America.
Six years from now, I will be very glad I did this.

Thoughts?

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