One of the main pillars of my multiple income streams is investment income, and I have received several reader questions to elaborate more on my investment income. I consider investment income any gains from dividends, distributions, or from the sale of investments.
I currently maintain the following portfolio that earns me a good investing income currently:
- AGNC – American Capital Agency Corp – 19.00% Yield ($5.60/share/year)
- XOM – Exxon Mobil Corp – 2.20% Yield ($1.88/share/year)
- CVX – Chevron Corp – 2.90% Yield ($3.12/share/year)
- MON – Monsanto Company – 1.50% Yield ($1.12/share/year)
- ABT – Abbott Laboratories – 3.60% Yield ($1.92/share/year)
- STT – State Street Corp – 1.70% Yield ($0.72/share/year)
As long as interest rates stay low, I will continue to invest heavily in REITs, like AGNC. This has been a great source of income over the past two years.
I also like pharmaceuticals and utilities, which traditionally are strong industries with strong companies, and pay a nice dividend.
State Street is currently my only growth play. I invest in growth companies only if they pay a dividend, as I like to be paid to hold a company.
Most of these companies pay their dividends quarterly. I only consider it income once it is in my account, not when it is declared. For example, I will be booking a nice quarterly dividend from AGNC for July.
Readers, what are your thoughts about maintaining a dividend portfolio for passive income? Do you go after individual companies or ETFs? I have invested in ETFs like DVY for years, but currently don’t.
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I’ve been quite hesitant on buying dividend stocks, no matter how attractive b/c of the rather bearish undertone in the markets i.e. buy a 3.5% yielding stock and watching the stock go down 8% does us no good.
How do you rectify this? Just buy and hold forever and collect the coupons?
When a company pays a div, the stock should go down by the dividend/share since there is a cash payout to shareholders. ONly if the markets believe in continued dividend growth should the stock price fall less than the div payout. I got this thought process right, right?
Very true – but if you look, all my pics were also value buys, and have appreciated 10-20% as well as paid a nice dividend. Don’t just buy on yield, it can get you no where if the stock goes down. Buy good companies at a good price that also pay a nice yield!
I am also a fan of dividend investment. I have a buy and hold strategy. I don’t have any you mentioned/ Targetting XOM in near future
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AGNC looks impressive.