Why I like dividend growth investing and you might too...
I have been a dividend investor for more than 20 months now and I was able to build a portfolio of over $350,000. Now the portfolio is hovering around $300,000. YTD my portfolio is down around 13% and wrecks my heart as my portfolio is going down everyday. There are times people in finance attack dividend growth investing at times for its focus on companies that payout dividends, and as it is passive form of investing - today I will try to defend DGI by showing how it's relatively good in all market conditions with a brief history and strategy of my portfolio. I look towards the positive side and why I choose Dividend Growth Investing in the first place.

๐Ÿ’ธ Dividend growth investing in every market conditions
The market can go in 3 directions and here are the scenarios and why dividend growth investing makes the best out of every conditions assuming companies that you invested doesn't cut the dividends:
  • ๐Ÿ‘‰๐Ÿฝ Sideways: If the price stays relatively flat, we can buy more of the shares at $100, and once the sideways movement ends the compounding will be greater as we accumulated more stocks at a small price.
  • ๐Ÿ‘‡๐Ÿฝ Downwards: Let's say if the market goes down, we still are getting the dividends from stocks that we hold. So, we can accumulate more of the dividend stock at a lesser price. We are increasing the cash flow and buying more assets.We just have to play the waiting game for the market to go to the bull run for capital gains.
  • ๐Ÿ‘†๐Ÿฝ Upwards: Although, our reinvested money won't be able to buy as much of the asset, we have both capital gain and dividends to re-invest.
๐Ÿ“ Brief history of my portfolio
I have been building my portfolio for few 20 months now and I have recently crossed $16k in dividends ๐Ÿฅณ๐ŸŽ‰. Capital gains can vanish like how it did with my $U but companies won't ask the dividends back

My portfolio link: here.

๐Ÿ™ˆ My strategy
I have concentrated down my portfolio into 3 parts in the hopes to achieve all the possible benefits of dividends and growth of dividend growth investing.
  • ๐Ÿ’ฐ Income: I want my portfolio to earn as much as I can, so I can re-invest as much as I can. This is possible due to covered call ETFs with high dividend yields like $JEPI, $QYLD and $BST. These 3 income ETFs yield at an average of 10.15% and has an expense ratio of 0.6% (on the higher side). They generate over 60% of my dividend income while they are 35% of my portfolio. I don't expect significant capital gain from it.
  • ๐Ÿ’ธ Cashflow: While income and cashflow are similar, cashflow category consists of monthly dividend stocks that yields at lower rates and has capital appreciation. This includes stocks like $O, $STAG, $AGNC, $NRZ. They cover around 15% of the portfolio while generating around 20% of the dividends income.
  • ๐Ÿ’— Growth: For growth in both capital gains and dividend CAGR I have stocks like $AAPL, $MSFT, $VICI, $VOO (i am planning to increase my position), $HD, $COST, $WM and $JPM. Together they make 45% of the portfolio and generating 20% of the dividends. They have a 3 year - weighted CAGR of 8.28% and average 3 year CAGR of 9.68%.

This gives my portfolio a decent place to stand. It will generate around $1,584.67 (while my cost per month are barely over $300) per month at 5%+ dividend yield (good cashflow). It also has a beta of 1.000217417 where I will be making gains similar to market (which I am happy about) and the movement lets me sleep well in the night as well (not too crazy in comparison to other individual stocks), so I can expect to make around 8ish% per year in capital gains. And, best of all the dividend CAGR is at 12%. So, I will be increasing my dividend cashflow too. This might be too conservative for some and but this gives me everything I need - cashflow and peace of mind.

Investing is like having sex - very personal. Everyone follows different strategy, and has different goals. But, every now and then it's exciting to mix things up. So, you might want to give DGI a try, you might like it...

And my final attempt to convince you to try DGI...

If this magic trick doesn't convince you, idk what will haha
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Keep accumulating and building that passive income! Doing that now when things are down is much better for you long term if you stick to it! Congrats on the substantial portfolio.
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Covered Call ETFs for Income
I buy into $XYLD every week and am a fan of it! It has a lower yield than $QYLD but better growth and beta. $RYLD is right in the middle with a yield higher and beta than $XYLD and lower than $QYLD, while also having the best growth rate. All have the same expense ratio.

After looking at it that way it seems to me that $RYLD may actually be best of the three! Which is your favorite or are there any other covered call etfs you use not in this list?
Favorite Covered Call ETF
9 VotesPoll ended on: 04/22/22
Love the strategy for income. I have been diving into covered call ETFs and settled on Jepi for my Roth. Just started a position last month. I like the combination of yield, holdings, and a lower expense ratio. All great though!
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Calling on fellow CS!
Inspired by @strib and @from100kto1m I would like to get feedback on the portfolio.
(below directly copied from Sam)

I keep my portfolio and trades public on CS for those who would like to follow my investment journey and am an open book (for better or for worse).
I usually share my portfolio as an update but this time I am asking for feedback!
What are your thoughts on my holdings?
Are there changes you would make?
Are there questions you have about why I am in a particular position? (I better be able to answer or I have more homework to do)

For context, I am 27, and all of my holdings are in my M1 Finance account. This portfolio allows me cashflow enough for me to be financially independent. I have recently started โ€‹angel investing thanks to this portfolio. I love to hold dividend/income generating income with a mix between short term income generating stocks like $QYLD and long term dividend growth companies like $COST.

Can't wait to hear your feedback, questions, or thoughts in general!
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$VICI is an interesting company. I watched a few videos on it. Sadly from a moral point of view I will not invest in gambling.

$U seems like the odd one out here. Won't see any dividends for the next decade at least I'd assume.
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I bought a bank ๐Ÿฆ
Background ๐Ÿ˜ถโ€๐ŸŒซ๏ธ:
I have a strong income generating dividend growth portfolio with mix of ETFs, and individual stocks which yields at around 5% with dividend CAGR at around 11%. I also have 6.2% of $U (the only stock that doesn't give dividend in the dividend portfolio). This has enabled me to be financially free for a while now. I generate around $1,529.32 per month on average (which is a lot on Nepal). Apart from this, I also generate money from my games. So, I have been generating decent cashflow. The cashflow has enabled me to travel to Turkey, and buy bunch of $U apart from covering my all of the costs.

Apart from my dividend portfolio I have a heavily concentrated growth portfolio of $U and $APP in my ROTH IRA. I also have another heavily concentrated growth + cashflow portfolio $U + $QYLD which re-invests $QYLD 's dividends to $U each month. Apart from it I also have a fund for my friends and family so I can hopefully help them to be financially free ๐Ÿคž๐Ÿพ.

A story from past โช:
I was in Bulgaria, trying to get a degree in Economics and running a game studio in Nepal. I wasn't working (mostly because of language barrier). It's fair to say, without parents support, I was struggling with finances and game studio was burning money. Here come two of my friends from my childhood to help me out. They were not making the banks, they were struggling as international students in the USA, one used to work as a janitor ๐Ÿงน and another used to work at gas station โ›ฝ๏ธ to earn for tuition, and rents. Despite having themselves they believed in my passion towards games and used to fund my game studio.

To the near-past ๐Ÿ˜ณ:The game studio did well, we made a global hit, made bunch of money, and it enabled me to be financially free, have a growth portfolio, help friends and family... so what was next for me?

๐Ÿš— ๐Ÿš— ๐Ÿš—
I want to be what my friends were to me during my startup days. I wanted to be an angle investor and invest in bunch of startups. I first started with a vehicle renting company in Pakistan called HumVie.

๐ŸŽฎ ๐ŸŽฎ ๐ŸŽฎ
Later few of my friends in Bulgaria wanted my help in their edu games pursuit, so I firstly offered my service as an advisor and when they needed money, I invested in the company. HMK has since raised more money at a valuation of $250k and the product is looking strong.

Present ๐ŸŽ:
So, today I have the biggest news of all. I am incredibly happy to announce that I have invested in a bank ๐Ÿฆ - Crescent Financial Inc. Technically it's not a bank, it's a financial tech company that offers users 100x. It offers 6% APY. The best thing, it doesn't have any hidden fees which is prevalent in its competitors. It is a great company led by Grant and with a sound tech team. I am really excited about the project.

If you want to check the project out: https://www.crescent.app/
We don't have hidden fees on waitlist as well ๐Ÿ˜ https://bit.ly/3fGdq1x

Whats next ๐Ÿ”ฎ:
I am planning to invest in 50 startups in next five years. I hope to invest more in Nepal and Asia, but will be open to any opportunity. I hope of of them works...

(There are two investments that are unannounced, will be announcing soon... hopefully this month.)
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I'm glad I've kept buying more $QYLD
Comparing the performance of $QYLD to $QQQ throughout the volatility, the covered call ETF has outperformed the Nasdaq ETF.

The covered call hedge helps smooth out the volatility of investing in the Nasdaq and the monthly dividends provide a neat cash return on my investment. In times like these, cash is king.

I will say that I'm surprised that more investors aren't piling into the covered call ETF as a "flight of safety" during these times.
My investing strategy
My long term investing strategy consists of mostly ETFs. I like to use M1 Finance because I can group multiple ETFs and stocks together into pies essentially creating my own ETF. ETFs are great because they can provide safety and consistency.
Hereโ€™s the break down of my pies on M1 Finance:
30% Income ETF: this pie includes ETFs that pay a high dividend yield and 2 that are tax advantaged. This includes $EVT $QYLD $RYLD $XYLD $HDV $DVY $HTD $JEPI $NUSI $UTG
25% Growth ETF: this includes ETFs with growth potential and different objectives and holdings. This includes $ENFR $DGRO $SCHD $VGT $EELV $VNQ
25% MLP: this includes master limited partnerships. These are a different type of investment that can offer high returns and tax advantages. This includes $AB $CEQP $EVA $MPLX $MMP $USAC
20% Dividend growth ETF: this is my own ETF I made of stocks with growth and consistent dividends. This includes $AAPL $ABBV $ABR $APTS $AVGO $BLK $BAC $BCE $BMO $BP $BXMT $CAT $CSCO $CVX $ENB $EQR $ESS $HRZN $HTA $IIPR $JPM $KB $KIM $KO $LYB $MMM $MO $MPW $MSB $MSFT $NEWT $NKE $O $OHI $OKE $PRU $RY $SBLK $SKT $STAG $STWD $TD $TGT $VZ $WPC $XOM
I use my Fidelity account to pick individual growth stocks and my TD Ameritrade account to swing trade.
Strategy: growth and income, mix of high and moderate risk
Dividend yield: 5.95%
Last year return: 12.29%
M1 Finance total holdings: 68 (16 ETFs)
Thanks for sharing about your ETF strategyโ€”

I think I remember hearing a bit about your Master Limited Partnership investing a while ago. I forget, what weโ€™re the tax benefits associated with those?
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Let's talk about the losers!!! ๐Ÿ˜ญ
We often talk about only winners, and to the audience, it probably seems like every stock is gonna go up. And, when we disclose about our losing stock - we end up giving reasons behind the fall and make it up saying oh I'll add because of conviction. But, we proudly show the winning stocks and rarely show the losing stock. I have been guilty of it.

What I can bet is no investor in the world has ever been green on all of their stocks. I am pretty sure they have closed at least one security on red.

I love being transparent, showing ups and downs, showing not all plays will be profitable and the goal is to offset losers with bigger winners.

List of my losing stocks:

I am significantly down on $LTC, $BTI, and $UL with 13%, 7%, and 7% down respectively. I am also down in the range of 4%-2% on stocks like $AGNC, $MMM, $ABBV, and $BEN. My recent purchases in the income fund ($NUSI, $QYLD, and $JEPI) have incurred an unrealized loss of over 1%. My total loss is $6,450.

I however am lucky to have gained significantly in other stocks like $U (+54%), $COST (+23.73%), $MSFT (+23.27%), $JPM, $STAG, $WM, $AAPL, $NRZ (+20% to +15%).

The game plan:
The game plan is to not incur a loss in the portfolio even if there are few red stocks. So, that's what I am doing right now. That's what I am doing as the well total gain is around $35,796.04, the net profit being $ 29,345.67. The gain from the top three gainers ($+7,392.80) offsets all of the losses of $6,450.
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This is why you should invest in ETFs. They provide a safer way to achieve high returns over time.

5 yr final balance after returns based on $10k investment (no additional contributions):

$QQQ- $33,472 234.72%
$QYLD- $17,029 70.29%
$XYLD- $15,477 54.77%
$DGRO- $20,521 105.21%
$VUG- $27,508 175.08%
$VNQ- $14,607 46.07%
$VOO- $22,128 121.28%

I have all of these in my portfolio
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