03-10-2014, 02:59 PM
The chowder rule appears to me to be an excellent metric for either initial screening or for determining the final cut. Dividend growth stocks represent great candidates in most anyone's portfolio, especially when in the early to mid accumulation phase. When nearing retirement, it would seem prudent to me, that an investors change the allocation to include more traditional income stocks (utilities, telecom, REITs, MLPs. etc.) and somewhat less DG or pure growth holdings. As posted earlier, my target in today's climate is to get an average current market yield of around 6%, which is what we are getting in our long term income portfolio. A 5% yield has been the cut off there, but once bought, the positions will be held as long as the company appears to execute well. I also want the holdings to give a reasonable shot a both dividend growth and at capital appreciation. For the foreseeable future, approximately 20% of our gross will be channeled into the dividend portfolio. Between dividend boosts, capital gains, and fresh capital, I would expect the portfolio to be well insulated from the effects of any likely level of inflation.
At some point we may include muni funds, preferred stock, and even CDs in the income account. The IRA will continue to be ear marked for more exotic investing such as covered call plays, short term trades, speculative buys, and pure options plays.
At some point we may include muni funds, preferred stock, and even CDs in the income account. The IRA will continue to be ear marked for more exotic investing such as covered call plays, short term trades, speculative buys, and pure options plays.
Alex