Birchtree's Account Talk

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A company dividend is paid every three months at a previously specified rate - when a company announces that they are going to increase the dividend rate that becomes a dividend increase announcement. A dividend increase impacts all owned shares and increases the yield on shares that were bought at an earlier date - we are having a yield shortage and dividends become important over time for performance. I reinvest all my dividend income to purchase more shares force feeding my account.
 
Birchtree said:
A company dividend is paid every three months at a previously specified rate - when a company announces that they are going to increase the dividend rate that becomes a dividend increase announcement. A dividend increase impacts all owned shares and increases the yield on shares that were bought at an earlier date - we are having a yield shortage and dividends become important over time for performance. I reinvest all my dividend income to purchase more shares force feeding my account.
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So, you've bought into a number of companies? I thought that was what buying stocks was - buying shares in a company. Or is this something different?
 
My oceanic account contains somewhere around 300 stocks - I'd say 75% of them pay a dividend. I also have a sacrificial lamb chop account that holds 8 stocks of varying size that I will use to protect my base if a margin call comes my way. I had three dividends pay today and two yesterday - so I'm usually buying something every day. It's my form of dollar cost averaging.
 
It's now seven days out of eight that the Transports have outperformed the Dow - playing catch up and messing with Dow Theory. Tomorrow could be a screamer to the upside so be ready.
 
Birchtree said:
My oceanic account contains somewhere around 300 stocks - I'd say 75% of them pay a dividend. I also have a sacrificial lamb chop account that holds 8 stocks of varying size that I will use to protect my base if a margin call comes my way. I had three dividends pay today and two yesterday - so I'm usually buying something every day. It's my form of dollar cost averaging.
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Ok, I must be missing something because you're speaking greek to me. Stocks pay a dividend...and we don't have that in TSP because they're not stocks, but indexes of groups of stocks? So the dividends you are getting are kinda like how you get a monthly bank statement saying you made a few dollars on your savings account, and that amount is rolled over into the total to earn a couple more cents in time. You do that with your accounts in a dollar cost averaging setup.

Don't buy-and-holders do the same thing in TSP, except that instead of dividends they use their paycheck inclusions?

So instead of your stock going up or down in price to give you a daily gain or loss like we see in TSP and in the markets, you get an overall positive or negative dividend that's released at certain times. That dividend is then rolled over to buy more stock. Do I have this right?
 
You are correct in your assumptions - your payroll inclusions are a form of dollar cost averaging. Just think how nice the beat down was back in 2008 - the C fund was around $8 and those that kept throwing good money down the dark rabbit hole bought more and more shares - and did well when the market turned up continually buying all the way up. Dividend amounts are held constant unless there is an increase or decrease - the price of the stock will fluctuate and depending when you buy it will determine the number of shares you accumulate. Mutual funds, ETFs, or index funds usually pay a dividend once a year in November or December - TSP does not allow you to participate in these payments. The dividend and any capital gain is used to cover the overhead costs of the fiduciary manager - that's why TSP is so cheap on costs. A dividend from a company is paid 4 times a year increasing the opportunity to dollar cost average toward golden prices. A new employee in a TSP account is going to find it harder to accumulate shares because the prices have essentially doubled - but it is what it is - still an excellent program to accumulate shares over a very long term. When I started my goal was to accumulate 40,000 shares of the C fund.
 
I would also mention that the benefit of reinvesting a dividend is its compounding effect - more shares purchased means a higher payout three months later which may mean even more shares can be purchased if the price of the stock has remained stable. This auto-pilot technique produces an income stream that grows over time. Now the value of the stock portfolio will fluctuate as the market fluctuates but the income remains reliable for life style. If you want to make an outside purchase or buy a larger block of stock simply take a capital gain by selling a company stock that you own and redirect the gains. Capital gains are a way to accumulate wealth because they are tax sheltered until utilized. An heir can benefit immensely with the step up in basis rule for capital gains. Remember, when anyone takes money out of TSP it is taxed as ordinary income which is higher than capital gains or dividends unless Obama wins and then it may change for the worse.
 
If qe bouys the market, what happens if we get a new fed head and s/he turns off the spigot?

Do businesses go hog wild hiring or does big money clam up when the borrow at 0.25% lend at 3.50% free trade game goes away?
 
I suspect that QE3 Infinity will remain intact until some semblance of a goal is achieved no matter who is Fed Chief. If Romney is elected then his policy directives will help businesses decide to start hiring and then the Fed may be able to go on hold for a period of time. I'm excited about the potential the market has for upside due to the compression factors and a chance for new leadership and business economic opportunities. Bonds will be a big push for the equity market at some point - we just have to wait until mom and pop realize there is stability and no available yield from bonds to secure their future.
 
Currently it looks like week #2 in October will be a loss for my oceanic account. However, there is another presidential debate next week to look forward to - another Donkey beat down would be purrfect.
 
It was a quiet week for the oceanic: -$17K, -$20K, -$22K, +$42K, -$19K for a devaluation of -$36K. This now leaves me ahead only +$23K so far this month. Now last year October was real good to me from 10/3 to 10/28 I cleared $627K and from 10/31 to 11/25 I gave back $480K - kinda like doing the Tango. Perhaps after Tuesday's debate things will open up. The small blessing is that every month that goes forward my dividend stream for income is growing like clock work. A few dollars here and a few more dollars there - next year dividend growth could be very healthy. I believe the tax situation will all settle out for the best.
 
"And at 83.1, consumer confidence is getting close to the 87 level it averaged in the year prior to the 2008-2009 recession. That's a lot more recovery than global economic have achieved, including that of the U.S. Is it just due to the pixie dust being puffed out by Wall Street and the Fed, about to be blown away by the gathering storm others see coming. Or has Main Street got it right this time, while the so-called 'smart money' is refusing to inhale the magic."

http://www.marketoracle.co.uk/Article36986.html

IMHO the market is simply dicounting a Romney economic BOOM that is likely to transpire as Obama takes his toast and heads home. I believe the market is seeing the toasted Obama-Baloney goodbye rally and it will continue. Let there be no mistake - we are witnessing a flameout of historic proportions. We need leadership that will back America.
 
krrk, whiskey one ... prometheus, you read, over?

got you prometheus, that's enough altitude, targets are drawn in, krrk.

roger that whiskey one, let it burn, krrk.
 
I believe the I fund will make me money today. The stock market is set in motion to resume its year end uptrend before the culmination of the four year Bull market cycle. "When an average makes a new high and that high is confirmed by a new high in the number of 52-week highs, the breadth of the market advance, the health of the average stock is deemed worthy." Be in to win.
 
Birchtree said:
I believe the I fund will make me money today. The stock market is set in motion to resume its year end uptrend before the culmination of the four year Bull market cycle. "When an average makes a new high and that high is confirmed by a new high in the number of 52-week highs, the breadth of the market advance, the health of the average stock is deemed worthy." Be in to win.
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Looks like it should be a good day for you. EFA up 1.5% so far this morning. You're sitting in a good position. :)
 
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