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Income Portfolio

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Due to this current market crash I will be starting a portfolio of dividend paying shares which I will be using to try to generate a long term income stream.

I will be using $50,000 start up capital with all dividends re-invested and I will try to invest another $5,000 each year for the next 5-10 years.

There will be basic fundamental requirements to be applied to each stock. Obviously paying a d/e, as well as low debt levels (due to current conditions), good earnings growth potential, a basic solid company history, I will also prefer a low d/e payout ratio.

I will also be filtering these stocks through tech analyse due to this being my preferred method of trading. I won't mind buying stocks in a trading range but won't be buying stocks in a solid downtrend unless there is a very good reason.

I won't be spending more than 10% on an individual stock to start with.

While these stocks will be purchased as long term holds I will not be bothered selling partial or full holdings of stocks if conditions require it.

I will be slowly drip feeding my capital into the market over the next 12-24 months as the current problems effect on company earnings becomes a bit clearer and we get a more accurate picture of d/e yields.

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Updated 4th-December-2008 at 10:09 AM by nomore4s

Income Portfolio


  1. nomore4s's Avatar
    I have purchased the first stock.

    MTS @ $4.20 x 600

    Will look to buy another 400 or so if & when there is a solid weekly close above $4.50. A weekly close under $3.60 would have me seriously looking at exiting the stock.

    Goes ex d/e on the 16.12.08 (I think) with a 10c d/e payment. Probably has a bit too much debt but posted fairly solid results so I will see what happens from here.
  2. grace's Avatar
    MTS is my grocer holding, and it has held up pretty well amongst the turmoil! I think I bought about 2 years ago for about what it is now, so it has held up really well.
  3. kennas's Avatar
    Nice blog thread. Look forward to seeing it develop.

    I'm finding it hard to pick good long termers at this stage based on current pe's and dividends due to the uncertainty of their future earnings.

    I suppose after some decent research there will be some the stick out more than others.

    Interesting that this is an 'income' portfolio, yet you are still going to trade in and out on some price variances on the stock.
  4. nomore4s's Avatar
    Thanks Kennas.

    This portfolio will take a while to get off the ground properly, no rush atm as I think we could see some even cheaper stocks and as I stated I want to see the effect on company earnings and dividends.

    I won't really be trading the stocks as such but I will exit or unload some stocks if required but I don't think it will happen very often. It's just buy and hold no matter what doesn't really sit well with me.
    If I can free carry a stock I will - then the free carried portion will pretty much become a buy and hold forever.

    Also if I feel a stock is getting too far from fair value or the chart shows signs of weakness after a strong run up I will look to unload part of my holding and then maybe re-enter later if opportunities present. This is probably more about trying to take advantage of opportunities and to keep the portfolio balanced.

    But the main goal of this portfolio is to generate a passive income so that in 10+ years I will have a solid income stream off of it.
  5. MRC & Co's Avatar
    Good stuff nomore.

    Will be an interesting blog thread.
  6. prawn_86's Avatar
    Nice work.

    I too am buying a few long term stocks for yeild
  7. nomore4s's Avatar
    Have purchased a couple more stocks this week.

    MND x 400 @ $6.90
    REF x 2500 @ $1.10

    Both companies have low debt and a solid earnings history and strong balance sheets atm. Very good yields if D/E are maintained.
    MND is actually in the middle of a share buy back, while most companies are issuing more shares to raise capital.

    Will post more info up at a later date on these 2.
  8. Garpal Gumnut's Avatar
    MTS is a good earner, a good choice mate.



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