Cheapo Groovo

Some changes to my high dividend strategy

I'm not convinced that the stock market drop is over. Today's rise is 401(k) money coming in. The December jobs report actually points to more monetary tightening and a flattening yield curve.

I got burned by ticker symbol SMHD . They stopped issuing new shares (which means you pay a premium to own it), and it dropped 24% in one month! If I go back in, I will buy ticker SMHB right after it goes ex-dividend. Also in a much smaller amount (20 to 25 shares).

I am also selling out of the money puts on ticker PSEC all the way out to January 2020.

So I went back to something I owned in the past - ticker symbol PHK. But I took profits quickly after I got my payout. Only $26.27 over 2 months but I'll take it!

Stash Your Cash!!! Avoid the Crash!!!

MINT aims to put your cash to work by earning you interest but still keeping risks relatively low. Made up of short-term bonds, it's likely to be steadier than most investments. The 30-day SEC yield is 2.9%.

Here is a screen shot of my transactions/dividend.

 

Automatic Investment Management – AIM

AIM is an investment method devised by the late Robert Lichello. This method is a proven way to take advantage of the inevitable market swings to enable us to ‘Buy Low / Sell High’.

Groundrules of how the AIM Strategy works:

1. When starting with a lump sum, only invest 50% from the start.  If establishing a monthly investment plan, also split this allocation to 50% invested (after all, there’s a 50/50 chance the market will go up OR down tomorrow!)
2. Utilize a cash account to maintain your investment reserves / gains, awaiting further investment (starting with the second 50% of your lump sum, and then including the proceeds from sales as well as 50% of any subsequent monthly investment.)
3. Be prepared to sell a portion of the gains you have realized and deposit them into your cash account, per the AIM algorithm.
4. Be prepared to buy some back with your reserved cash account when the stock declines.
5. Set a routine period of time in which to analyze the markets direction, and take action.
6. The algorithm is relatively simple.  It involves several key points:
   1. Portfolio Control:  Running total of your stock purchases (total initial purchase plus 1/2 of follow on purchases; however it is never deducted from in a sale) in order to keep a basis of where the portfolio should ‘aim’ to be.  This is the ‘governor’ of the system – it drives the initial assessments about buy and sell decisions. 
   2. Buy/Sell Advice:  Based upon the current Stock Amount (currently owned shares times current price) compared to the Portfolio Control figure.  When the Portfolio Control amount is larger than your current Stock Value, you will look to buying (the Market is down.)  When your current Stock Value is higher than your Portfolio Control, you will look to selling (the Market is up.)
   3. SAFE (Stock Adjustment Factor Equalizer):  10% of the Stock Amount – After you do the analysis in [b] above, you compare the results to your SAFE amount – you only pull the trigger on a sale or purchase for the amount of Buy/Sell Advice less SAFE; this controls you from selling or buying too prematurely.

TIP ME and I will email you the spreadsheet and a help file!